SAINUDDIN S Vs. COMMISSIONER OF AGRICULTURAL INCOME TAX

JUDGEMENT

(1.) AT the instance of the assessee, the Agricultural Income-tax Appellate Tribunal, Thiruvananthapuram, has referred the following questions of law for a decision of this court :

(2.) THE assessee, Sri S. Sainuddin, was assessed to agricultural income-tax for the assessment years 1978-79 to 1985-86. He is engaged in rubber plantation at Nedumangad. THE only issue that was canvassed before the Appellate Tribunal is the legality of the inclusion of income from 7.6 acres of agricultural land which was alleged to be owned by his children. This property, held by the assessee in usufructuary mortgage rights, is alleged to have been released to his children who had obtained assignment of the equity of redemption. THE release of the mortgage rights was made by means of an agreement in 1976, but the registered document was executed only in 1985. THE properties having been released by the assessee in 1976 itself, he disclaimed ownership over the extent of 7.6 acres of land.

(3.) BEFORE proceeding to examine the contentions raised on both sides on the questions referred, we have to mention that the questions do not cover an important finding of the Tribunal on which also it had rested its conclusion. The Tribunal is of the view that the property has been transferred without adequate consideration and that directly calls for application of the provisions regarding inclusion of deemed income. The Tribunal observed thus : "even if we examine the case from the angle of Section 9 of the Agricultural Income-tax Act, the consideration declared, viz., Rs. 2,200 for 7.6 acres of rubber plantation, is grossly inadequate." This observation is seen to have been made while answering the contentions advanced by the Additional State Representative on behalf of the Revenue who had invited the attention of the Tribunal to the provision contained in Section 9 of the Agricultural Income-tax Act. No request is seen to have been made for a reference on the question of the applicability of the provisions of Section 9 to the transfer effected by the assessee, nor is that aspect covered by any of the questions referred to this court. Section 9(2) of the Agricultural Income-tax Act, 1950, directs computation of the total agricultural income of any individual for the purpose of assessment by including so much of the agricultural income of a minor child of such individual as arises directly or indirectly from assets transferred directly or indirectly to the minor child not being a married daughter by such individual otherwise than for adequate consideration. On the basis of the materials available, the Tribunal held against the assessee on this aspect. A specific finding was rendered that the property was transferred without adequate consideration and that directly calls for application of all the provisions regarding inclusion of deemed income.