Agricultural income

I think its Rs.4,50,000/-

never came across such problem.... but deduction should not be allowed, as i feels...

Hi Raj

For the purpose of partial integration, Net agriculture income should be used.

Here interest of loan is paid for the purpose of earning that agricultural  income. so while calculating agriculture income it should be deducted. And Rs 450000 should be clubbed with business income while doing partial integration.

his agricultural income will be RS.450000 bcz interst is being paid by him and its an eligible expense .

Just like we deduct business expenses in PGBP ....

well its my logic bt still let the expert reply as well ....

"Renu" and "Sanat Kumar" are right,Only net Agricultural income is to be clubbed..

Expenditure incurred can't be allowed in relation to exempt income.

Thus .intt on loan can't be deductible  from agriculture income.

This is my perspective.

Pls ref these links

https://www.taxpundit.org/ITRPDF/302ITR/302ITR218.pdf

https://www.bcasonline.org/articles/artin.asp?770

Expenses incurred for eg cultivation expenes,seeds,fertilizers etc. in connection with such income shall be deducted from such agricultural receipts as per Rule7 of Income Tax Rules 1962

If the income does not form part of assesee's total income chargable to tax no deduction is allowed in respect of such income.

But here will be 450000 because agriculture income itself means after deducting all expenses incurred in connection with agriculture activity.

I think its clear now.

@ Mansha : You are right but it is applicable in claiming deduction of expenses regarding exempt income against other taxable income,That is any agricultural expenses can not be claimed against other business income.

However as Ritu said assesses can claim all relevant expense in case of agricultural income and only net income is to be considered for determining Slab of Tax

Agriculture income is exemt u/s 10 therefore any expenditure incurred to earn exempted income will not be allowed as deduction.

Agriculture income above Rs. 5000 will be clubbed with other income to find out tax liability .

yes i agree with Ritu statement .Those expenses(directly related to agriculture activcity) are allowed  but intt  payment u/s 36(1)(iii) can not be allowed .This is my view

Please read case studies & u/s 14 A -Disallowance of income tax act.

Thanks