Section 8 in The Assam Agricultural Income-Tax Act, 1939
8. Determination of agricultural income mentioned in sub-clause (2) of Clause (a) of Section 2.
(1)The agricultural income mentioned in sub-Clause (2) of Clause (a) of Section 2 shall be assessed on the net amount of such income determined in the prescribed maimer.(2)Rules prescribing the manner of determining the net amounts of agricultural income for the purpose of this clause shall provide that the following deductions shall be made from the gross amounts of such income, namely:(a)the sum actually paid in the previous year as revenue to the Government or as rent to a superior landlord in respect of the land from which such agricultural income is derived;(b)the sum actually paid in the previous year in respect of such land as any local rate collected under any enactment in force in Assam;(c)any rent paid under Village Chowkidari Act, 1870, in respect of any building used for the purposes of cultivation of land from which such agricultural income is derived;(d)the expenses of cultivating the crop from which such agricultural income is derived and of transporting such crop to market, including the maintenance of agricultural implements and cattle required for the purpose of such cultivation and for transporting the crop to market;(e)any tax, or rate paid under any enactment in force in Assam on the cultivation or sale of the crop from which such agricultural income is derived;(f)(i)any expenses incurred on the maintenances of any irrigation or protective works constructed for the benefit of the land from which agricultural income is derived;(ii)any expenses incurred on the maintenance of the capital asset, if such maintenance is deemed to be required for the purpose of deriving such agricultural income from such land;(iii)interest actually paid on any amount borrowed and actually spent on any capital expenditure incurred for the benefit of the land from which such agricultural income is derived, or for the purpose of deriving such agricultural income from such land;(iv)(a)depreciation of any asset required for the benefit of the land from which such agricultural income is derived or for the purpose of deriving such agricultural income from such land, subject to the provisions of this Act in the manner allowed and at the rates prescribed for the purposes of Indian Income-tax Act or in default of such prescription as prescribed by rules under Section 50 of this Act;(b)in respect of any such machinery or plant which in consequence of its having become obsolete has been sold or discarded, the difference between the written down value as defined for, the purposes of Indian Income-tax and the amount for which the machinery or plant is actually sold or its scrap value;(v)any sum paid in order to effect on insurance against loss or damage of crop or property from which agricultural income is derived :Provided that notwithstanding anything contained in this Act in the case of an assessee in whose case deduction on the account is made in assessment any amount received by him from the insurance company in any year shall be deemed to be for the purposes of this Act agricultural income after deducting the share or portion thereof assessed to the Indian Income-tax Act;(vi)any interest paid on any mortgage or other capital charge incurred for the purpose of acquiring the property from which such agricultural income is derived or for the purposes of cultivation of the property.(vii)any expenditure (not being in the nature of capital expenditure) laid out or expended wholly and exclusively for the purpose of earning or deriving the agricultural income; provided that such expenditure, if laid out or expended wholly and exclusively for the purpose of earning income chargeable of tax under the Income Tax Act, 1961 (43 of 1961) would have been admissible for deduction under that Act;(g)any sum actually donated for charitable purposes, if such donation is not more than Rs. 5 lakhs or ten per centum of the total agricultural income whichever is less; provided that such sum is actually spent for such purposes in the State;(h)such other deductions as may be prescribed by the rules made under Section 50 of this Act:Provided always that no deduction shall be made under this clause, if it has already been made under Section 7 of this Act or in the assessment under the Indian Income-tax Act;Provided further that in case of agricultural income from cultivation and manufacture of tea the agricultural income for the purposes of this Act shall be deemed to be that portion of the income from cultivation, manufacture and sale which is agricultural income within the meaning of the Indian Income-tax Act and shall be ascertained by computing the income from the cultivation, manufacture and sale of tea as computed for Indian Income-tax Act from which shall be deducted any allowance by this Act authorised in so far as the same shall not have been allowed in computation for the Indian Income-tax Act.(3)In determining the net agricultural income, such percentage of total agricultural income of the assessee as may be notified by the State Government from time to time and deposited with the Assam Financial Corporation in the previous year in an account (hereinafter referred to as the Plantation Development Account) maintained by the assessee with the Assam Financial Corporation for utilisation for the purpose specified below to Clauses (a) to (e) of this sub-section, shall be allowed as deduction to the assessee from the agricultural income; provided the same has not already been allowed as deduction under any of the provisions of the Indian Income Tax Act, 1961 :Provided further that where such assessee is a firm, or any association of persons or any body of individuals, the deduction under this sub-section shall not be allowed in the computation of the income of any partner, or as the case may be, any member of such firm, association of persons or body of individuals :Provided further that if any withdrawal from the deposit is not utilised for the purpose for which it is sanctioned, it shall be treated as agricultural income of the year of the withdrawal and assessed accordingly :(a)extension of planting, replanting, replacement, rejuvenation or consolidation of areas of plantations or interplanting of planted areas including preparation of land, care and maintenance of such areas and provision of nurseries and shade trees;(b)extension of factories and godowns;(c)purchase of tractors, trailers, power trailers, power trollies for the purpose of expansion of plantation;(d)purchase of spraying equipment for weed control and plant protection measures;(e)measures for controlling floods, soil erosion and water logging including drainage.(4)(a)In determining the net agricultural income, any amount invested in the setting up of power generation units and industrial units within the State of Assam other than tea plantation and manufacturing shall be allowed as deduction to the assessee for his agricultural income, provided the same has not already been allowed as deduction under any other provisions of this Act or under any provisions of the Income Tax Act, 1961 or the same has not been received as any subsidy or grant by the assessee from the Government of India or the Government of Assam.(b)For the purpose of this sub-section the State Government shall have the power to formulate a scheme by notification in the Official Gazette, specifying the industries which shall be eligible for the benefits of the scheme and may, by a notification in the Official Gazette, specify the conditions, subject to which the benefits of the scheme may be extended to the power generation units or the industrial units.(c)The State Government may, from time to time and in the public interest, modify, amend or alter the scheme in such manner and to such extent as the State Government may deem fit.(d)Any scheme formulated under this sub-section shall as soon as may be after it is notified in the Official Gazette, be laid before the House of State Legislature, while it is in session for a total period of thirty days, which may be comprised in one or more session in which it is so laid or the session immediately following and if, the House agrees in making any modification in the scheme, the scheme shall thereafter have effect only in such modified form :Provided that any such modification shall be without prejudice to the validity of anything previously done under the scheme.(e)Any scheme formulated and modified under this sub-section or any modification, amendment, alteration or re- enactment thereof shall be deemed to form a part of the Assam Agricultural Income Tax Act, 1939 and all the provisions of the said Act shall apply accordingly.(5)In determining the net agricultural income, a deduction at the rate of 50 (fifty) paise for every kilogram of tea exported through Inland Container Depot (ICD), Amingaon shall be allowed to the assessee from his agricultural income :Provided that this deduction shall be effective on and from 1st April, 1998 for a period of two years only :Provided further that the State Government may be notification in the Official Gazette, extend the period of deduction for further periods, not exceeding one year at a time, subject to such conditions and restrictions as may be specified in the said notification.
