COMMISSIONER OF INCOME TAX Vs. RATILAL TARACHAND MEHTA

JUDGEMENT

(1.) THIS is a reference made by the Tribunal to this Court under S. 66(1) of the Indian IT Act, 1922, and the question of law referred to us for our opinion runs thus :

(2.) MR . Joshi, appearing for the Revenue, has contended before us that the Tribunal was in error in applying the principle which was applicable in the case of payment of salamis or premiums at the time of creating monthly tenancies and it is in the context of such monthly tenancies that were granted by the assessee to the tenants that the aspect of payment of salami or pagdi made over by the tenants to the assessee should be considered.

(3.) THE question whether salami received by a landlord for settling agricultural land or granting of a perpetual lease came up for consideration before the Supreme Court in the case of Member for the Board of Agrl. IT, Assam vs. Sindhurani Chaudhurani (1957) 32 ITR 169 (SC). At page 174, Kapur J., speaking for the Court, has observed thus :