AI Data Pulse
Items 699▲ 3.2% Total Views 382016▼ 0.8% Latest ID 705▲ 1.1% Categories 3▲ 0.5%

HEADLINES | INCOME TAX | TOP STORIES Mushroom is an ‘Agricultural Product’, No Tax on its Production

2018-07-17 453 views ✦ AI Summary
◆ AI Content SummaryGenerated by rules engine

The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) in Dy IT v. M/s. Inventaa Industries Private Limited held that the income from production and sale of Mushroom can be termed as ‘agricultural income’ under the Income Tax Act, ... Keywords: HEADLINES · | · INCOME · TAX · | · TOP · STORIES · Mushroom …

 Mushroom-Taxscan
The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) in Dy IT v. M/s. Inventaa Industries Private Limited held that the income from production and sale of Mushroom can be termed as ‘agricultural income’ under the Income Tax Act, 1961. Earlier, the department took a view that the Mushrooms are grown by the assessee in ‘growing rooms’ under ‘controlled conditions’ in racks placed on shelves above land and on Compost (manure) which is prepared with paddy straw, Horse manure, Chicken manure, Gypsum and Urea which is not land. Hence the activity is not an agricultural activity. The assessee contended that what is produced by performing basic operations on the soil, is an agricultural product, even though the product is not a ‘plant’ or the ‘flower’ or a ‘vegetable’ or a ‘fruit’. It was emphasized that the nature of the product is irrelevant as far as it is produced by performing some basic operations on the soil. Allowing the contentions of the assessee, the Tribunal noted that “Mushroom, like vegetables and other crops or plants, are grown on soil/land and are always attached to the soil until harvested. They draw their nourishment from the soil only. The product mushroom does not arise from any secondary agricultural operation.” The bench, after considering the facts and circumstances of the case, concluded that Mushroom is an agricultural product raised from land. “It cannot be said that production of mushroom is remotely connected with land. This product arises from land and is attached to land during growth and thereafter, just like ‘plants’ or a ‘crop’. The comparison made by the Ld.AO with the sale of silk cocoons by relying on the judgment in the case of K.Lakshmansa & Co. vs. CIT [1981] 128 ITR 283 (Kar.), is wrong, as on facts silkworms feed on mulberry leaves and are not products which are raised from land. Mulberry leaves which are product arising from land, are fodder to silkworms,” the bench said.
 

✦ This entry has been parsed into the following data domains:

1Species Resource Bank
2Market Quotation Bank
3Company Entity Bank
◈ Data InsightReal-time metrics of this entry
453Total views
▲ +45 today
0Comments
— Idle
2018-07-17Published
— Indexed
462Item ID
✦ AI Index
⚑ Report ★ 0
More »>Comments
No comments yet — be the first to share your view.
EMUSHROOM

Since 2010Global Mushroom Industry Portal · News / Tech / Business / Community

16+yrsIn Operation
10k+Enterprises
200+Expos
100+Media Partners
200+Live Sessions
100k+Listings
520k+Forum Posts
200k+Members
(c)2010-2026 Emushroom All Rights ReservedAddress: Room 1001, Bldg 2, Optics Valley HQ Times, Guangu Ave 35, Wuhan, China