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TMI Blog2019 (6) TMI 1044X X X X Extracts X X X X X X X X Extracts X X X X ..... l under the term of agricultural produce. However, at this juncture, it is important to note the context in which the term agricultural produce has been used. It has been used in the context of the activities of APMC (from which it derives income) constituted under the DAPM for the purpose of regulating and marketing. It is therefore, incumbent to see the relevant Act which empowers the committee to undertaken the regulating and marketing of commodities. In view of the expanded meaning given to the term agricultural produce by the DAPM Act, it is our considered opinion that the word agricultural produce , used in connection with APMC connotes a very wide meaning bringing within its preview a large gamut of commodities besides agricultural products. Since the income accrues to the APMCs from pursuing these activities, the Income Tax Act, also perceives a wider meaning by referring to the DAPM. If the term agricultural produce is given a wider meaning in terms of the definition of agriculture produce as defined in section 2 (a) of the DAPM Act and as specified in the Schedule of the said Act, fish, poultry and eggs would also be covered under the definition of agricultu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ural Produce Market (Regulation) Act, 1976 and entrusted with the duty of supervising, controlling and providing facilities to the traders operating in the Committee premises. It was further submitted that the assessee regulates the marketing of fish, poultry and eggs. It was explained that the raw material is brought in by the wholesalers and after refining the same i.e. after checking, cleaning, sorting/segregating, chopping, preserving, and packing, the same is supplied to various buyers by the traders who are operating in the Committee area. It was submitted by the assessee that the committee has been formed for better regulation of notified agricultural produce in the notified market for the benefit of the farmers, growers, commission agents and traders and to see that the farmers get the best price of their notified produce in the market. It was submitted that since these activities fall within the purview of exemption as specified in section 10(26AAB) of the Act, the assessee was eligible for the said exemption. Apart from this, the assessee also submitted various other documents in support of its claim. 2.2 However, the Assessing Officer was not convinced w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mption to these kinds of committees, it would have been specifically mentioned. The Ld. Sr. DR submitted that the Ld. CIT (A) had misinterpreted the provisions and had allowed the assessee s claim in complete disregard to the fact and law. 4.0 In response, the Ld. Authorised Representative (AR) submitted that the assessee has been constituted under the Delhi Agricultural Produce Marketing (Regulation) Act, 1976 u/s 23 of the said Act on 31.08.2001. It was submitted that section 10(26AAB) of the Income Tax Act, 1961 provides for exemption to Agricultural Produce Marketing Committee or Board which has been constituted under any law for the purpose of regulating the marketing of agricultural produce and for the State of Delhi, the relevant law is Delhi Agricultural Produce Marketing Regulation Act, 1998 which empowered notification of any area in Delhi for the purpose of regulating marketing of agricultural produce u/s 3 and 4 of the said Act. It was further submitted that the assessee has been appointed u/s 35 of the said Act to facilitate trading in fish, poultry and eggs vide Notification in the Delhi Gazette NCTD No. 200 dated 31.08.2001. It was submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icultural Produce Marketing Committee or Board 7.1 Clause (26AAB) has been inserted in section 10 to provide for tax exemption with respect to the income of an Agricultural Produce Marketing Committee or Board which has been constituted under any law for the purpose of regulating the marketing of agricultural produce. 7.2 Applicability - This amendment has been made applicable with effect from 1st April, 2009 and shall accordingly apply for assessment year 2009-10 and subsequent assessment years. 5.2 Section 10(26AAB) provides exemption to Agricultural Produce Marketing Committee (APMC) or Board constituted under the law in force for the purpose of regulating the marketing of Agricultural Produce. For the State of Delhi the relevant law is the Delhi Agricultural Produce Marketing (Regulation) Act, 1998 (Hereinafter referred to as DAPM). This Act empowers notification of any area in Delhi for the purpose of regulating marketing of agricultural produce under sections 3 and 4 of DAPM. 5.3 At this juncture it would be relevant to go through some of the provisions of this Act: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (g) regulate the marketing of notified agricultural produce in the market area and the market, and the weighment, delivery of and payment for, such agricultural produce; Explanation - for the purposes of clause (g) the word regulate' shall include - (i) making, carrying out, enforcing or cancelling of any contract of sale of a notified agricultural produce ; (ii) conducting or supervising of a transaction of sale or purchase of a notified agricultural produce in accordance with the procedure laid down under this Act, or rules, regulations and bye-laws made there under; (iii) specifying any place or spot where a notified agricultural produce shall stored or displayed for purpose of sale by open auction ; (iv) fixing the time for holding auction; and (v) cancelling an auction if it is not held in the presence of the employees of the marketing committee. (h) arrange for the collection - (i) of such notified agricultural produce in the market in which all trade therein is to be carried on exclusively by the Government by or under a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to facilitate free and fair trade of the agricultural produce and not to undertake trading on this own behalf. It has to provide a place where the producer and the consumers can meet and trade freely. The committee is entitled to a fee for the service rendered. It is recovered from the commission agents who undertake the trading on behalf of the purchaser and the seller. The assessee has been appointed u/s 35 of the DAPM Act to facilitate trading in fish poultry, eggs etc. The composition of committee is approved by the Lt. Governor of Delhi has been notified in the Delhi Gazette, NCTD No. 200 dated 31.08.2001. 5.5 It is seen that the Assessing Officer, while rejecting the claim of the assessee, has been guided by the fact that the assessee is dealing in fish, poultry eggs and not agricultural produce. As per the Assessing Officer, the assessee should be engaged in the marketing of anything produced from the use of land which should fall in the definition of word agriculture as defined in section 2(1A) of the Act. He has dealt with various case laws relating to the definition of agricultural income. He has also drawn reference to the speech of the Union Finance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a etc. XII. Pesciculture - Fish XIII. Pulses - Arhar, Beans, Gram, Moth, Mung, Peas etc. XIV. Vegetables - Arvi andArvi Patta, Carrots- all types. Onion etc. XV. Horticulture - Flowers, cut flowers and Potted Plants. XVI. Forest Products - Bamboo, Baheda. Gum, Honey, Karela, Mahua flowers 5.8 From a plain reading of the definition, it is apparent that DAPM Act does not restrict the constitution of committee only for marketing of agricultural produce. It has within its scope various other commodities like decorative plants production of honey and silk etc. It also includes the marketing of forest products which would otherwise not fall within the definition of agriculture . The DAPM Act, therefore, has given very wide meaning to the word agricultural product. Apparently, Income Tax Act has also imported the word agricultural produce from the DAPM Act, 1998 to cover APMCs notified under it to provide the benefit to all APMCs provided in the DAPM Act or similar Acts in other states. It could not have been the intention of the Act to leave out some of the committees, notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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