RANI BHUNESHWARI KUAR Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) This is a reference made by the Commissioner of Income-tax, Bihar and Orissa, under Section 66(3), Income-tax Act, 1922. The learned Commissioner was called upon to state a case upon the following points: 1. Whether the sum of Rs. 158 received by the assessee for settlement of lands is assessable to income-tax or is it agricultural income within the meaning of Section 2, Income-tax Act, 1922?

(2.) Whether the sum of Rs. 2000, received by the assessee for certain lands and other sources connected therewith from the mukarraridars or permanent lease- holders is assessable to income-tax or is it agricultural income within the meaning of Section 2, Income-tax Act, 1922? 2. The assessee in the case is the proprietress of the Tikari Raj in the Gaya District. She has been assessed for many years on (a) the annual rental of house properties, (b) the income from money-lending business and (c) the income from non-agricultural sources connected with zamindari, and the question to be considered in this case relate solely to the last source of income. For the assessment year 1936-37 the Rani returned an income of Rs. 11,044-15-3, from this source of income, that is, non-agricultural income connected with zamindari, and filed statements in support of it. The Income-tax Officer, after scrutinising the statements with the books of accounts, found several items of omission and required the assessee to file supplementary statements.

(3.) In this supplementary statement an omission of Rs. 158 is shown as "nazrana payable for settlement of lands" and it is this sum of Rs. 158 that gives rise to the first question. I shall deal more fully with the facts relating to this sum later. The Income-tax Officer further found that the statements and supplementary statements were not satisfactory and further that a portion of the assessee's zamindari was not in her own possession but was leased out to mukarraridars who paid rents to her.