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Cash from forest tree

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Rajat Sharma

Accountant

436 Points Posted on 08 September 2023

Sir with due respect I want to know that I am an wine contractor for the A Y 2023-24 and I am also in possession of forest land and in the forest land having too much verious tree and the said tree has been sold by me for Rs 30.00 Lac in cash to verious forest contractors.Sir the said forest land having 1/2 share of my brother.But all the amount received by me in cash from verious forest contractor and deposit in my current account by me.Sir I want to know that can I deposit the said amount of sale of tree in my current account. all the amount received from the contractor was less than 2.00 Lac.Please guide me Thanks

Replies (3)

Quick Summary

A wine contractor who also owns forest land sold trees for Rs 30 lakh in cash. They deposited the individual payments, all under Rs 2 lakh, into their current account. The advice given is that this cash deposit will be treated as 'Income from other Sources' for tax purposes, unless accounts are audited under Section 44AB. Sales of trees are not considered exempt agricultural income.

Suresh Kumar

Account

298 Points Posted on 08 September 2023

If you will deposit the said Amount in your current account, it will be considered as 'Income from other Sources' until you don't audit ur accounts under section 44 AB.

Sales of trees will not be considered as exempted Income like agriculture income

sabyasachi mukherjee

Profession

19978 Points Posted on 15 September 2023

Audit of accounts applies elsewhere.

Aashok Kumar Sharma

Finance/Compliance Consultant

75651 Points Posted on 08 November 2026

Wine contractor with forest produce income:
• If you have income from sale of trees or forest produce from agricultural land (naturally grown trees, not cultivated), it isn't agricultural income (SC in Raja Benoy Kumar Sahas Roy: spontaneously grown trees aren't agricultural operations). Taxable as Other Sources or business income.
• If the trees are cultivated (planted and tended), it's agricultural income (exempt).
• Liquor contractor income: business income. TCS under 206C(1) applies on purchase of alcohol for human consumption (1%) and forest produce (2.5%), collected by the seller.