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TMI Blog2023 (4) TMI 1172X X X X Extracts X X X X X X X X Extracts X X X X ..... s well as the order under section 143(3) read with section 263 of the Act were quashed. It is also not in dispute that the activities conducted by the assessee in this case are similar to the activities of M/s. Nuziveedu Seeds Ltd. [ 2015 (3) TMI 938 - ITAT HYDERABAD] It does not deny the fact that the activities of the assessee include such operations as are defined as the agricultural operations under section 2(1A) of the Act. Complaint of the learned Assessing Officer is that merely because the assessee is conducting the activities like sowing, weeding, irrigation, inter-cultivation etc., the same cannot be considered as agricultural operations u/s 2(1A) of the Act, because assessee conducts such activities as incidental to the main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee to own all the land, as required for the purpose of its agricultural operations, it has accordingly taken certain land on lease from farmers and has also availed services of farmers by entering into seed production agreement for usage of their land; that the farmers are provided with foundation seeds for carrying out the agricultural activities/cultivation for multiplication of seeds under the guidance, specifications and supervision of the assessee; that the farmers are required to deliver the final produced hybrid seeds including un-utilized foundation seeds in the assessee; that in lieu of the said activities, the assessee agrees to pay the farmers compensation for land usage and reimbursement of cultivation expenses and servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one, right from the research and development to the final marketing/sale of hybrid seeds which involves several stages and the first few stages cannot be isolated and termed in by the assessee company; that the definition of agriculture as contemplated in section 2(1A) of the Act does not cover the activity of foundation seeds production by the assessee, just because the assessee is undertaking basic agricultural operations like sowing, weeding, irrigation, inter-cultivating etc., and that such agricultural activities are only incidental to the main activity of production of foundation seeds. According to the learned Assessing Officer, the assessee departed from the basic agricultural operations and indulged into the production of the paren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... activity bereft of carrying of agricultural activity. Learned DR submitted that the assessee itself does not undertake any agricultural operation but procured hybrid seeds from farmers and as such the activities carried out by the farmers alone can be said to be agricultural activities but not the activities of the assessee. It is further submitted that the issue on identical facts in the case of M/s. Nuziveedu Seeds Ltd., for the assessment year 2011-12 is pending before the Hon ble High Court and, therefore, the same cannot be taken as the settled principle of law. 8. Learned AR, Per contra, submitted that there was no disallowance of the claim for deduction under section 10(1) of the Act in the earlier assessment years and more partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 263 of the Act. It is also not in dispute that the order under section 263 as well as the order under section 143(3) read with section 263 of the Act were quashed. It is also not in dispute that the activities conducted by the assessee in this case are similar to the activities of M/s. Nuziveedu Seeds Ltd. 10. Learned CIT(A) followed the view taken by a Co-ordinate Bench of this Tribunal in the case of M/s. Nuziveedu Seeds Ltd., (supra) for the assessment year 2010-11 and 2011-12. In that case, a Co-ordinate Bench of this Tribunal while dismissing the appeal preferred against the orders of the learned CIT(A) allowing such a claim, followed the decision of the Hon ble jurisdictional High Court in the case of Prabhat Agri Bio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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