COMMISSIONER OF INCOME-TAX Vs. VTSSEVUGA PANDIA THEVAR

JUDGEMENT

(1.) At the request of the petitioner the Commissioner of Income-tax has referred the following question of law to the High Court, vis.: Whether the income from the fisheries is exempt from the assessment from income-tax on the grounds that they are not so assessable under the terms of the sanad granted to the Zamindar of Seithur and of Secs.1 and 4 of the Madras Regulation XXV of 1802 and on the ground that the said income is agricultural income especially in view of the definition of rent in Section 3(11)(b) of the Madras Estates Land Act.

(2.) The facts of the case are that in the assessment made on the petitioner for 1929-1930 a sum of Rs. 6,956 was included. This was income derived by the petitioner from the lease of the right to fish in a number of tanks and connected supply channels in the Zamindari the water in which is used for agricultural purposes. Excepting the right to fish, the lessees have no other rights whatsoever in the water of the tanks and channels nor have they any right over the bed of the tanks and channels. The land on which the tanks are and through which the channels run is agricultural land and assessed to land revenue in British India. It will be seen from the question referred to us that exemption is claimed for the income on two grounds, but Mr. S. Srinivasa Aiyangar for the petitioner stated that he was not prepared to argue that the income was exempt for the former reason stated in the question because he was unable to argue that there was any real difference between the Madras Regulation XXV of 1802 and the Bengal Regulations which were relied upon for a claim to exemption of Zamindari income, a claim which was negatived by a Full Bench of the Calcutta High Court in Emperor V/s. Probhat Chandra Barua (1927) I.L.R. 54 C. 863 (F.B.) On appeal to the Privy Council this decision was affirmed in Probhat Chandra Barua V/s. King-Emperor (1930) L.R. 57 I.A. 228 : I.L.R. 58 C. 430 : 59 M.L.J. 814 (P.C.). Mr. S. Srinivasa Aiyangar accordingly directed his argument to the latter ground for exemption raised in the question referred. It would appear that even this question is determined by the decision of the Privy Council in Probhat Chandra Barua V/s. King-Emperor (1930) L.R. 57 I.A. 228 : I.L.R. 58 C. 430 : 59 M.L.J. 814 (P.C.). One of the questions submitted for the decision of the Calcutta High Court in Emperor V/s. Probhat Chandra Barua (1927) I.L.R. 54 C. 863 (F.B.) was whether jalkars or rents received from fisheries was agricultural income and therefore exempted from assessment to income-tax by Section 4(3)(viii) of the Act. It was held by the Calcutta High Court that that income was not agricultural income as defined by Section 2 (1) so as to exempt from tax under Section 4(3)(viii) and that decision, as already stated, was affirmed by the Privy Council. But that point does not appear to have been seriously argued because Lord Russell of Killowen in delivering the judgment of their Lordships Board says at p. 448: Question 1 was but faintly argued before the Board. As to it their Lordships need only say that they have not been furnished either with materials or reasons which would justify them in suggesting that any of the 10 4 specified items could properly be described as agricultural income within the definition of agricultural income contained in Section 2(1) of the Indian Income-tax Act, 1922. Their Lordships accordingly agree with the negative answer which has been given to Question 1.

(3.) It is not clear what the fisheries were from which the income in that case was derived by the Zamindar, whether fishery rights were over streams running through the Zamin-dari property or rivers or whether the right to fish was, as in this case, in tanks and channels used for-irrigation purposes. All that we know is that it was income derived from fisheries and we are left in doubt as to whether the Privy Council had under consideration the same facts as there are here with regard to fishery rights.