The question (6 marks)
Deepa owns shares in a company that grows and manufactures tea, part of whose income is agricultural income. In the same tax year she also receives a sum from a plot she owns, on which a neighbour had for years been cutting and selling grass that grew of itself, Deepa herself having done nothing to the land. She claims that neither receipt is chargeable. Advise her, with reasons. (6 marks)
MU Module I, agricultural income; pack ch. 01, problem question.
Plan your answer on paper before you look at the authorities — issue first, then the rule, then apply it to these facts.
It tests Unit 1 · Foundations of Indian Tax Law of Law of Taxation.
Authorities you will need
- Section 2(5), Income-tax Act
- Section 11(1) with Schedule II, Table Sl. No. 1, Income-tax Act
- C.I.T. v. Benoy Kumar Sahas Roy
- Bacha F. Guzdar v. C.I.T.
- Entry 82, List I and Entry 46, List II, Seventh Schedule, Constitution of India
How an answer is marked
A full-marks answer names the issue in one line, states the rule with its section, cites the authority, applies it to these facts and concludes — in that order. The app's model answer for this question is written in exactly that shape, with a checklist to mark your own attempt against.