TROPICAL PLANTATIONS LIMITED Vs. STATE OF KERALA

JUDGEMENT

(1.) THE Kerala Agrl. Tribunal has referred the following two questions of law for our determination :

(2.) THE common expenses in respect of the Chittady Estate and Vengathanam Estate and Vellandy Estate were claimed to relate to the immature area of the rubber plantation in the estate. The assessee's complaint was that the apportionment between the immature and the mature area of the estate violated the principle laid down in Commr. of Agrl. IT vs. Johnsons Estates & Agencies (P.) Ltd. (supra). In that case, a Division Bench of this Court surveyed the legislative history and the course of decisions leading to the enactment of new Expl. 2 to S. 5 of the Kerala Agricultural IT Act and the decisions of the Supreme Court in Karimtharuvi Tea Estates vs. State of Kerala (1963) 48 ITR (SC) 83 and Tranvancore Rubber and Tea Co. Ltd. vs. State of Kerala (1963) 48 ITR (SC) 102, and observed in (1964) 52 ITR 629, 633 (Ker) :

(3.) THE Tribunal has come to the conclusion that the disallowance of Rs. 4,915 was not proper and there is no material before us even the sheet No. 31 mentioned by the Tribunal is not part of the paper book to differ from its conclusion even if we have the power and the inclination to do so on this question of fact. What the Department has done is to divide the total of the estate or overhead expenses by the number of acres comprising the estate and then multiply the expenses per acre by the number of acres covered by the immature plants in the estate of the assessee. This is an arbitrary approach which cannot be justified." To complete the discussion, we may quote S. 5(j) of the Agrl. IT Act, and Expl. 2 to the said section. These are as follows: