The Income Tax Department has clarified that the cash sales of agricultural produce by a cultivator to a trader for less than 2 lakh rupees will not attract tax under the Income Tax Act. Who is present Chairman of Central Board of Direct Taxes (CBDT)?

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	Ashwani Lohani
B	Sushil Chandra
C	Ajay Tyagi
D	Rajeev Kumar

Explanation:

Detailed explanation-1: -Therefore, any cash sale of an amount of Rs. 2 lakh or more by a cultivator of agricultural produce is prohibited under section 269ST.

Detailed explanation-2: -If a farmer’s income is less than Rs. 5, 000 or if the total income minus the agricultural income is less than the basic exemption limit which is Rs. 2.5 lakh for a person below the age of 60 years and Rs. 3 lakh for an individual aged 60 years and above, then the income generated will be exempted from being taxed.

Detailed explanation-3: -The central government cannot levy tax on the agricultural income received. However, agricultural income is considered for rate purposes while assessing the income tax liability if the following two conditions are met: Net agricultural income is greater than Rs. 5, 000/-for previous year.

Detailed explanation-4: -However, as per section 10(37), no capital gain would be chargeable to tax in case of an individual or HUF if agricultural land is compulsorily acquired under any law and the consideration of which is approved by the Central Government or RBI and received on or after 01-04-2004.

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