<s>[INST] What is the provision of Rule 7 of the Income-tax Rules, 1962? [/INST] ​Rule 7 applies to the income, which is partially agriculture income and partially business income.

Rule 7 provides that where the cultivator or receiver of rent-in-kind utilizes agricultural produce in his business as raw material, the market value of such produce is deducted while computing the taxable profits of such business.

Similarly, if sale receipts of the agricultural produce are included in the accounts of the business, it shall be deducted. 

No further deduction is permissible in respect of any expenditure incurred by the assessee as cultivator or receiver of rent-in-kind. ​ </s>