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TMI Blog1992 (4) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1983-84 the assessee had exported dry chillies. In the previous year relevant to the assessment year 1984-85 it had exported Methi seeds. The Assessing Officer negatived the assessee's claim on two counts, namely, (i) what was exported by the assessee was primary agricultural produce, and (ii) there were no similar exports in the immediately preceding years of account. 3. The CIT(A) allowed the assessee's claim holding first that the goods in question were not primary agricultural produce and secondly that " the statement that in the earlier years the assessee had not done any export business is not maintainable as it is factually incorrect ". 4. It is in these circumstances that the Department is now before us. 5. Shri G. Natara ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l were made during the previous year relevant to the assessment year 1982-83. 9. As for the assessment year 1984-85, the position is that during the relevant previous year the assessee had exported Methi seeds and not dry chillies. In the immediately preceding year of account (that is to say in the previous year relevant to the assessment year 1983-84), the assessee had exported dry chillies and not Methi seeds. And the ITO had disallowed the assessee's claim, inter alia, on the ground that there was no export of Methi seeds in the immediately preceding year of account. 10. For settling the controversy before us certain questions need to be asked and answered. The first question is : Can dry chillies and Methi seeds validly be classifie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rring in section 80HHC(2)(b)(i) of the Act. Neither the Income-tax Act, 1961 nor the Rules framed thereunder contain any definition of the said term. Even so, one can look to the definition of the term " agricultural income " contained in section 2(1) of the Act for light, Agricultural income means, inter alia, any income derived from agricultural land by agriculture or the performance by a cultivator or receiver of rent-in-kind of any process ordinarily employed by a cultivator or receiver of rent-in-kind to render the produce raised or received by him fit to be taken to market. Thus, primary agricultural produce does not cease to be primary agricultural produce by reason only of the facts that some process is ordinarily employed to render ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a primary agricultural produce. 13. If any authority is needed for the above proposition, it is to be found in the Madras case of South Arcot District Co-operative Supply Marketing Society Ltd. v. CIT [1974] 97 ITR 500. 14. In the case before us we have two commodities, namely dry chillies and Methi seeds. It is elementary that green or raw Methi seeds are not sold as such even in the local market. They are dried, cleaned, graded and sorted before they are sold in the local market. At the end of such minimum process, Methi seeds remain what they are, namely, primary agricultural produce. 15. The same considerations will apply to dry chillies also. True some amount of green chillies are marketed as such for cooking purposes, but the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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