IN THE INCOME TAX APPELLATE TRIBUNAL “SMC’’BENCH: BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA Nos.1013 & 1014/Bang/2025 Assessment Years : 2018-19 & 2020-21 Satyenra Kumar Gutgutia

383/A, 4^th Main, Rajiv Gandhi Nagar NTI Housing Society

2^nd Phase, Near Sahakaranagar DCIT Railway Underpass Vs. Central Circle 1(4)

Sahakaranagar Bangalore Bengaluru 560 097 PAN NO :ADRPG8676J APPELLANT RESPONDENT Appellant by : Sri B. Chattaraj, &

Sri P Gurudatta D., A.Rs Respondent by : Shri Ganesh R. Ghale, Standing Counsel for Revenue.

Date of Hearing : 21.07.2025 Date of Pronouncement : 17.10.2025

O R D E R

PER KESHAV DUBEY, JUDICIAL MEMBER:

These appeals at the instance of the assessee are directed against the orders of the ld. CIT(A)-11, Bengaluru, both dated 5.3.2025 vide DIN: ITBA/APL/M/250/2024-25/1074056433(1) for the AY 2018-19 and vide DIN: ITBA/APL/M/250/2024- 25/1074056666(1) for the AY 2020-21. Since the issue in both these appeals is common, these are clubbed together, heard together and disposed of by this common order for the sake of convenience.

2. First, we take the ITA No.1013/Bang/2025 for adjudication, in which the assessee has raised the following grounds of appeal:

3. The brief fact of the case are that the assessee is carrying on the activity of running a nursery where the plants, seeds, seedlings, flowers etc. are grown and sold. In the process the assessee deploys large agricultural lands owned by the assessee around Bangalore district and Hassan district where on those lands, the basic agricultural operations like Tilling, sowing of seeds etc., have been carried out. Thus, the assessee is carrying out floricultural operations under his proprietary concern “Florence flora farm” on the lands owned by him. The income from the same is being declared as agricultural income for the AY 2018-19. The assessee has filed his return of income on 31.08.2018 declaring the total income of Rs. 5,64,160/-. Thereafter the case of the assessee was selected for scrutiny under CASS and accordingly notice u/s. 143(2) as well as 142(1) of the act were issued to the assessee seeking certain details as per the notices sent. After considering the replies furnished by the assessee and relying upon the decision of the Hon’ble ITAT, Bench “A”, Bangalore in the case of Invitro International (P) Ltd. v/s Dy. Commissioner of Income Tax, 11(4), Bangalore, the AO held that where any operation is not carried out on land, such an operation cannot be called as agricultural operation. When the assessee is not carrying on the cultivation of land or plants in the soil in pots, the operation cannot be called as agricultural operations. The medium is not the soil or basic operation of agriculture such as tilling of the land, sowing of the seeds, etc are not carrying out. The AO concluded that the tissue culture process is non-agricultural process. Therefore, the income in correspondence to the expenses incurred towards tissue culture activity can not be treated as agriculture income within the meaning of section 2(1A) of the Act and accordingly treated Rs.5,96,201/- [ Rs.44,75,485 (-) Rs.38,79,284 ] as income from business and completed the assessment on a total income of Rs.11,60,361/-.

4. Aggrieved by the order of the AO passed u/s. 143(3) of the Act dated 13.08.2021, the assessee preferred an appeal before the ld CIT(A).

5. The ld. CIT(A)-11, Bengaluru dismissed the appeal of the assessee by relying on the same decision of the ITAT, Bengaluru as relied by the AO in the case of M/s. Invitro International (P) Ltd v/s. DCIT cited (Supra) as well as Hon’ble ITAT, Hyderabad in the case of one Shri. Madhu Velayudhan wherein it is held that income from production and sale of tissue culture plants is business activities and not an agricultural income. The ld. CIT(A) observed that the assessee has not disputed the fact that the process of tissue culture does not involve activities on land or soil. In view of the above facts