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Cites 3 docs
Section 10(1) in The Income- Tax Act, 1995
The Commissioner Of ... vs Raja Benoy Kumar Sahas Roy on 23 May, 1957
The Income- Tax Act, 1995

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Delhi High Court
Commissioner Of Income Tax vs Proagro Seeds Co. Ltd. on 27 March, 2006
Equivalent citations: (2006) 206 CTR Del 483, 2008 296 ITR 235 Delhi
Author: T Thakur
Bench: T Thakur, J Malik

JUDGMENT T.S. Thakur, J.

1. The assessed is engaged in the production and sale of hybrid seeds. For the asst. yr. 1997-98, it appears to have claimed exemption from payment of income-tax under Section 10(1) of the IT Act, 1961 on the ground that the income derived by it was from 'agricultural activities'. The AO rejected that claim and brought to tax the amount of income disclosed by the assessed. Simultaneously, proceedings under Section 271(1)(c) were also initiated which culminated in the levy of a penalty of Rs. 3,49,58,630. Aggrieved by the said order the assessed appealed to the CIT(A) who affirmed the penalty and dismissed the appeal. In a further appeal before the Tribunal the assessed succeeded. The Tribunal upon appreciation of the facts and circumstances of the case held that the Department had not alleged any concealment or inaccurate furnishing of particulars of the assessed's income. It observed:

8. It is nowhere the case of the Department that the assessed either made any covert concealment of its income or that it furnished any inaccurate particulars of its income. It is by way of analogy that the concealment has been imputed to the assessed by saying that in the light of the decision of 'Raja Benoy Kumar Sahas Roy' (supra), the activity carried out by the assessed was not an agricultural activity. On the basis of this law of the land laid down by the Supreme Court, the assessed has been insinuated with the offence of concealment. Curiously though, the assessed has itself relied on 'Raja Benoy Kumar Sahas Roy' (supra). It has been contended that the Hon'ble Supreme Court has, in very many details, discussed the concept of agriculture.

2. The Tribunal further held that in the earlier assessment years the Department had treated the activity undertaken by the assessed to be agricultural activity and accordingly granted exemption to the income derived from the same. Penalty for the year under consideration was, however, levied on the basis of a decision of the Supreme Court in CIT v. Raja Benoy Kumar Sahas Roy . The assessed also incidentally relied upon the same judgment in support of the claim that its activities were agricultural in case. The Tribunal looking to the attendant circumstances concluded as under:

Still further, the conduct of the assessed as well as the Department shows that there is no means read attributable to the assessed. The assessed has all through been laying bare all the facts pertained to earn its income before the Tribunal, that even as much as scintilla of either suggestio falsi or suppressio veri. The assessed can, in no manner, be said not entitled to entertain a bona fide belief, which has been repeatedly accepted by the Department over the years.

3. In the light of the above findings clearly holding that there was no deliberate concealment of the income nor any inaccurate furnishing of particulars of the income and that the assessed's perception that its activities were agricultural in nature and had been treated to be so for the previous years, no question of law can be said to arise for our consideration. This appeal accordingly fails and is hereby dismissed.