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TMI Blog1964 (3) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... rst deal with the second of the two questions referred. The question reads as follows : Whether the profit by the conversion of cocoanuts grown on the assessee's own garden into retted husk and copra is exempt from tax under the provision of section 4(3)(viii) having regard to the definition of agricultural income in section 2(1)(b)( ii) ? Sub-section (3) of section 4 of the Indian Income-tax Act, 1922, provides that any income, profits or gains falling within the classes specified in that sub-section shall not be included in the total income of the person receiving them. Clause (viii) of the clauses specified is agricultural income . Section 2(1) of the Act defines agricultural income. The relevant portion of the definition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to convert the kernel into copra and ret the husk to sell it as such or as fibre. It seems to us that when these operations are made not by machine but only by manual labour it cannot be said that anything more than operations to make it fit to be taken to the market has been done on it. The exemption under section 2(1) applies. In his affidavit dated July 29, 1961, the assessee made the following affirmation : I am an agriculturist owning extensive cocoanut gardens and paddy fields. During the years under appeal, I owned 86-28 acres of cocoanut gardens and about 15 acres of paddy fields. The annual production of nuts will be about a lakh and a half. Like all other agriculturists owning extensive cocoanut gardens I also was conve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal we cannot but decline to answer the second of the two questions referred. This, however, does not mean that we endorse the conclusion reached by the Tribunal or that anything in this judgment will preclude a different conclusion in the future. The first of the two questions referred relates to the ambit of two orders of remand, annexure D to the statement of the case dated March 31, 1957, and annexure B to the statement of the case dated February 12, 1958. Both the orders were passed by the Appellate Assistant Commissioner. Annexure D relates to the assessment year 1950-51 and annexure E to the assessment year 1953-54. The Appellate Tribunal dealt with the matter as follows : Learned counsel for the assessee cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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