VENKATASWAMI NAIDU R Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE question that has been referred to us under Section 66(2) of the Indian Income-tax Act runs:

(2.) INCOME and agricultural income have been defined by Section 2, INCOME-tax Act. The expression "agriculture", however, has not been defined by the Act. "Agricultural income" has been defined by Section 2(1) of the Act. "Agricultural income" means:

(3.) IT is with reference to these principles that we have to answer the primary question that arose for consideration in this case: "Was the milk the assessee sold in the accounting year an agricultural produce?" If it was, the profits of sale of the milk should be viewed either as income derived from "such land" by agriculture within the meaning of Section 2(1)(b) (i), or as income derived from such land "by the sale by a cultivator of the produce raised .........by him in respect of which no process has been performed other than a process of the nature described in Sub-clause (ii)" within the meaning of Section 2(1)(b)(iii). In fact, it would satisfy the requirements of both the subsections, though even one would be sufficient to treat the income as agricultural income to secure for it the exemption granted by the Act.