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TMI Blog1956 (3) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... e contract, Exhibit A-1, prohibiting the assessee from cutting all the bamboos in a cluster or tender shoots less than a year old. The bamboos were of spontaneous growth in the Government forest. There were restrictions imposed on the assessee and his men and servants with regard to the entry into the forest and egress out of it when cutting bamboos. The assessee paid a lump sum to the Govern- ment as consideration for the right of cutting the bamboos from the forest during the stipulated period. The assessee issued permits to cut and remove the bamboos to various persons for money received, the aggregate of such sums amounting to Rs. 41,305-8-0. The assessee objects to the inclusion of this sum in his turnover for two reasons firstly becau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other produce has been held not to be agricultural income, Mustafa Ali Khan v. Commissioner of Income-tax(2), and a person who takes contracts in natural forests for the purposes of cutting down and selling timber has been held not to be earning agricultural income: Commissioner of Income-tax, Madras v. Manavedan(3). The juxtaposition of the words "agricultural" and "horticultural" and the reference to the "produce grown" in the proviso to section 2(1) of the Act indicate that what is exempted from the "turnover" by the proviso is the produce of land resulting from the application of human effort to the land in the shape of manuring, tilling, ploughing, planting, sowing, watering, weeding, pruning, harvesting, etc. Forest trees of spontane ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and did not create any interest in land in the assessee. This is a case where, to quote Lord Coleridge, C.J., in Marshall v. Green(1), "the parties agree that the thing sold shall be immediately withdrawn from the land, the land is to be considered as a mere warehouse of the thing sold, and the contract is for goods". The position is the same as if the bamboos had been stored by the Government in its godown and the assessee had bought the bamboos for a price with the implied or incidental right to go and fetch them and so reduce them into his possession and ownership. Exhibit A-1 is in substance a contract of sale of bamboos fit for cutting in certain coupes in a Government forest and an immediate severance and realisation of the trees by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... multiple tax at every point of sale and payment of tax at one sale point does not debar a levy of tax on another sale of the goods. Under section 8-C of the Act, the State Government is entitled, in respect of any sale of goods effected by it, to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under the Act. The Government was therefore entitled to collect the tax from the assessee and the latter when he sold the bamboos would have realised from the buyers the tax that he had paid to the Government by including it in the cost price. When the assessee sold the bamboos to others, he was bound to pay sales tax to the Government for in the case of goods with which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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