S R RAMAKRISHNAN Vs. AGRICULTURAL INCOME TAX OFFICER

JUDGEMENT

(1.) THE judgment of the court was delivered by In this case, the assessee had granted a lease for the cultivation of his agricultural lands to certain lessees. A certain portion of the arrears of lease due for the period 1951-52 to 1955-56 about Rs. 3,000 and odd was received by him during the period 16th July, 1956, to 15th July, 1957. It is common ground that this last mentioned period is the first "previous year" for the assessment of the agricultural income of the assessee after the Madras Agricultural Income-tax Act (after the amendment of the Act in 1958) came into force with effect from April 1, 1958. Section 2(t) of the Act defines "previous year" as meaning "the twelve months ending on the 31st day of March next preceding the year for which the assessment is to be made or if the accounts of the assessee have been made up to a date within the said twelve months, in respect of any year ending on any date other than the said 31st day of March, then at the option of the assessee, the year ending on the day to which his accounts have been so made up." In the present case the accounts of the assessee have been maintained for each Fasli from 16th July of one year to 15th July of the next year.

(2.) AS mentioned above, it is not in dispute that the arrears of lease fell due from the lessees to the assessee for a period anterior to the passing of the Madras Agricultural Income-tax Act. The assessing officer (the Agricultural Income-tax Officer) held that since the arrears were received in the course of the previous year, the assessee was liable to pay agricultural income-tax thereon without reference to the fact that the period, to which the arrears related, was a period anterior to the coming into force of the Act. The ASsistant Commissioner of Agricultural Income-tax however allowed the appeal relying upon the decision of this court in Puthutotam Estates (1943) Ltd. v. Agricultural Income-tax Officer. The Commissioner of Agricultural Income-tax took up the case in revision so motu, reversed the finding of the ASsistant Commissioner of Agricultural Income-tax, and restored the finding of the assessing authority. In view of the Commissioner, since the assessee had chosen to maintain his accounts on the basis of "cash system" as distinguished from "mercantile system", he could not demur to the assessment on the basis of the actual receipt of the sums in question during the previous year. Certain other reasons have been given by the Commissioner, but the last-mentioned reason alone has been pressed on us prominently by learned Government Pleader appearing for the State to support the order of the Commissioner at the time of the revision case.