GEORGE OOMMEN Vs. STATE OF KERALA

JUDGEMENT

(1.) The Agricultural Income Tax Appellate Tribunal, Trivandrum, has referred the following question of law for opinion of this Court, viz:

(2.) The second objection of Counsel for the Revenue was that S.5(j) of the Agricultural Income Tax Act, is not in pari materia with S.10(1)(15) of the Indian Income Tax Act 1922 or S.37 of the Act of 1961 and that the question requires to be considered whether the payment of wealth tax can be said to represent "expenditure wholly and exclusively incurred for the purpose of deriving agricultural income". As this aspect of the matter has neither been investigated nor found, by any of the taxing authorities Counsel for the Revenue submitted that the matter should go back for investigation and finding before the Tribunal. We do not wish to foreclose any possible investigation that might be necessary in regard to this aspect of the matter. We therefore answer the question of law as follows:

(3.) The Wealth Tax paid by the Assessee on his agricultural lands is an allowable deduction under S.5(j) of the Agricultural Income Tax Act 1950, provided the expenditure was wholly and exclusively incurred for the purpose of deriving agricultural income. Whether the expenditure was so incurred or not, is a matter to be found by the Tribunal for which purpose the Tribunal will take back the Agricultural Income Tax Appeal No. 243 of 1974 to its file and proceed to dispose of it in accordance with law. We answer the question of law to the extent indicated, in favour of the assess e and against the department. No costs.