- No, purchase of standing crop is a non-agricultural income.
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About Agricultural Income:
- The income earned from agricultural land is exempt from taxes under Section 10(1) of the Income Tax Act 1961. Agricultural income in India is categorized as a valid source and essentially incorporates income from sources that include farming area, structures on or identified with a rural land and business deliver from a horticultural land.
Agricultural Income includes:
- Any rent received from land which is used for agricultural purposes.
- Agricultural operations which mainly include processing of farm produce which is then sold in the market as agricultural produce.
- Income obtained from a farmhouse which is in proximity to the land you own. and which may be used as a storehouse or a dwelling unit.
- It is very necessary that land exists and it is used for agricultural operations. Agricultural operations means the seeds should be planted and effort made to sprout seeds from the land and cultivate the land.
- Let us consider that you receive rental income from your land..It is very necessary that agricultural activities are carried out on this land. Only then can you state that rental income obtained from your land is agricultural income.
- The income obtained from sale of replanted trees and growing flowers and creepers
- Income obtained from the sale of seeds.
- The profits received from your partner who is engaged in agricultural produce or activities.
- Income earned from nursery operations such as selling of plants and flowers.
Non- Agriculture Income includes:
- Revenue from the sale of processed products of agricultural nature without actual agricultural activity.
- Revenue from extremely processed products.
- Revenue from trees that have been sold as timber.
- Income from poultry farming.
- Income from bee hiving.
- Income from sale of spontaneously grown trees.
- Income from dairy farming.
- Purchase of standing crop.
- Dividend paid by a company out of its agriculture income.