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1. This reference arises out of the assessment of income-tax under Act VII of 1918 of the income derived by the Zemindar of Singampatti from forests and fisheries within the ambit of his zemindari. The assessee objects to the assessment, (a); on the ground that income is agricultural income within the meaning of Section 4 of the Act, and, therefore, not chargeable to income-tax, and (b) that the assessment is illegal as contravening the terms of his permanent sanad of the zemindari and the provisions of Regulation XXV of 1802.

2. It is convenient to consider first the effect of the sanad a copy of which has been filed before us, and the terms of the Regulation. The sanad is a lengthy document largely reproducing the language of the Regulation under which it was granted. Its general effect is this, that in view of the bad effect of fluctuations in the assessment of land revenue both in obstructing the development of the country and diminshing the security of property, the British Government has resolved "to fix for ever a moderate assessment of public revenue on the lands" held by zemindars and others: and to that end has fixed the permanent annual junta (total demand) of the Singampatti Zemindari at 2,300 star pagodas. Clause 4 of the sanzd says: "This permanent assessment of the land-tax on your zemindari is exclusive of the revenue derived from the manufacture and sale of salt and salt-petre, exclusive of the sayer or duties of every description, whether by sea or land the entire administration of which the Government reserves to itself; exclusive of the abkari or tax on the sale of spirituous liquors, and intoxicating drugs, exclusive of the excise which is or may be levied on commodities or articles of consumption; exclusive of all taxes personal and professional, as well as of those from markets, fair and bazaar; exclusive of lakheraj lands (lands exempt from payment of public revenue) and of all other alienated lands paying a small quit rent (which quit rent unchargeable by you is included in the assets of your zemindari); and exclusive of an lands and trussooms heretofore appropriated to the support of Police establishment. The Government reserves to itself the entire exercise of its discretion in continuing or abolishing temporarily or permanently the articles of revenue included, according to the custom and practice of the country, under the several heads above stated."

15. We would answer the reference by saying that the income from forests and fisheries in the Singampatti Zemindari is not liable to income-tax.

16. The s ssessee's costs will be borne by, Government, Vakil's fee will be Rs. 25.