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TMI Blog1984 (6) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... ck and sides. The property in question was rented out to the Indian Explosives Limited at a total monthly rent of Rs. 2,000 per month with rental bifurcation in respect of different parts of the property, as under: Rs. "(a) Rent for accommodation on GF 750 per month (b) Hire for fixtures and fittings (detailed in Schedule) on GF 300 per month (c) Rent for one bedroom with attached bathroom on FF 200 per month (d) Hire for fixtures and fittings, namely, for first floor room 50 per month (e) Rent for ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her order making the following observation, confirmed the action of the ITO : "... This income cannot be categorised as agricultural income within the meaning of section 2 of the Income-tax Act. This income is part and parcel of rental income." 4. While disputing this finding of the AAC, the learned counsel for the assessee S.S. Rikhy submitted that three requirements, stipulated as per definition of 'agricultural income' are there, viz., (i) rent or revenue derived from, (ii) land which is situated in India, and (iii) is used for agricultural purposes. He submitted that from the deed of tenancy, it was apparent that the garden was separately rented out and he made available to us the copy of letter dated 5-3-1981/11-3-1981 and 30-7-197 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) House No. 28, Sector 9-A, belonged to the assessee and the same being surrounded by a garden comprising of ground floor, first floor, garage, servant quarters, fixtures and fittings, etc., was rented out for a total sum of Rs. 2,000 per month. (ii) As per bifurcation available in the tenancy note, Rs. 2,400 was to be paid per annum to the assessee as fixed price of fruits of all the fruit trees except one Mango Langra and one Alichi plant near the servant quarters. The ITO, however, challenged in the assessment order, as per his observations, extracted and placed above, that no evidence was produced to show that rental income of Rs. 2,000 per month included Rs. 2,400 on account of value of fruits but when it came up to the stage of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other hand, some of those cases support the contention that of the assessee. The first case of Raja Mustafa Ali Khan, which was relied upon by the learned departmental representative was in respect of malikana payments and in that case the forest trees were growing on the land naturally and without the intervention of human agency. If the case in question is carefully read, distinction would be apparent that in the instant case it was not a question of spontaneous growth but of plants which were grown being fruit trees. Similarly, the case of Maharaja Pratap Singh Bahadur again pertains to malikana and there also it was held that the malikana was not agricultural income inasmuch as it was not established by the revenue authorities that it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 237 (PC), CIT v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 (PC), Bacha F. Guzdar v. CIT [1955] 27 ITR 1 (SC) and Maharajadhiraja Sir Kameshwar Singh v. CIT [1961] 41 ITR 169 (SC) applied. (iii) that the amount received by the respondent was revenue income and was, therefore, taxable. Where an owner of an estate exchanges a capital asset for a perpetual annuity, it is ordinarily taxable income in his hands. The position will be different, if he exchanges his estate for a capital sum payable in instalments : the instalments when received would not be taxable income." Coming to the last case relied upon by the learned departmental representative which was that of Rani Ratnesh Kumari's case, that was a case also of malika ..... X X X X Extracts X X X X X X X X Extracts X X X X
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