Geetanjali Pandey
Quick Summary
This article is aimed at enlightening the exemption and allowance provided by the Income tax Act in respect of any agricultural income earned by the assessee from carrying out any agricultural activities. To avail the benefit and exemption, we need to first understand the concept of Agricultural act
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FAQ :
Agricultural income is defined as rent or revenue derived from land situated in India and used for agricultural purposes, or income from the sale of agricultural produce on which basic or advanced agricultural activity has been conducted.
Agricultural activity involves operations on a farm connected with the commercial production of farm products, including cultivation, tilling, sowing, planting, tending, pruning, cutting, and harvesting, as well as making the produce fit for market.
No, only revenue derived from land situated in India and used for agricultural operations is exempt. Land kept vacant or used for research and development without agricultural processes does not qualify.
Income from a building on or near agricultural land is considered agricultural income if the building is used for storing produce or implements, or as a dwelling unit by the cultivator/receiver of rent, and not for business purposes by others.
Income from the transfer of land, income derived from buildings not used for agricultural operations, selling processed produce without carrying out agricultural operations, timber sales, interest on arrears of rent, and activities like dairy farming or poultry farming are generally excluded.
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