- (1.) These three petitions arise out of three orders passed under S.35 of the Karnataka Agricultural Income Tax Act, 1957 (hereinafter referred to as the Act) by the Commissioner of Agricultural Income Tax, Karnataka. Since common questions of law and facts arise for consideration, they are disposed of by this common order.
(2.) Shivappa Karachi was the owner of the lands with which we are concerned in these cases. He had leased them out in favour of M|s Ugar Sugar Works Ltd in the year 1947. By effiux of time the said lease came to an end on 31.3.1967. On 27.3.1967 during the subsidence of the lease, there was a partition amongst Shivappa Karachi and his sons. At that partition the lands in question were allotted to the shares of A.S.Karachi, V.S.Karachi and J.S.Karachi, the sons of Shivappa Karachi, who are petitioners in these three petitions. The lessee did not handover possession of the lands to the petitioners herein immediately after the expiry of the period of lease. After some negotiations they were handed back to the possession of the peti ioners on 2.9.1967 along with the standing sugar-cane crop. The petitioners carried on some further agricultural operations on the lands and ultimately harvested the sugar-cane by the end of December 1967 or the beginning of January 1968 and realised its value by selling to M|s Ugar Sugar Works Ltd. In their individual returns which they filed under the provisions of the Act for the year 1968- 69 they claimed that they were not liable to be taxed under the provisions of the Act in respect of the income derived by 'them individually by selling the sugar-cane referred to above. Their contention was that the income was not agricultural income as denned under the Act as they had not planted the sugar cane and carried on other basic agricultural operations till 2.9.1967. The Agricultural Income Tax Officer rejected their contention and included the income derived by them by selling the sugar-cane grown on the lands in question during the previous year in the assessable income and passed orders of assessment accordingly. Aggrieved by the orders of the Agricultural Income Tax Officer the petitioners filed appeals before the Deputy Commissioner of Agricultural Income Tax. He allowed the appeals holding that the income in question was not agricultural income. Thereafter the Commissioner of Agricultural Income Tax initiated action under Sec.35 of the Act and after hearing the petitioners passed orders reversing the orders passed by the Deputy Commissioner of Agricultural Income Tax and restoring the orders of the Agricultural Income Tax Officer. Hence these three revision petitions.
(3.) The undisputed facts in these cases are that the petitioners were the owners of the lands on which sugar cane had been grown; that they had carried on agricultural operations after 2.9.1967: and, that they had received the income during the relevant year Sec.2(1) (a)(2) (i) of the Act defines agricultural income as any income derived from land which is used for growing any commercial crop by agriculture. It is not disputed that the sugar cane in question had been raised by the petitioners by carrying on agricultural operations though the lessee had carried on such operations till 2.9.1967. Subsequent to 2.9.1967 agricultural operations had been carried on, by the petitioners in order to derive the income in question. It is seen from 'he facts narrated above that all the ingredients which are required to make an income as 'agricultural income' are available in these cases, namely, agricultural land, agricultural operations and income derived from Commercial crops grown on agricultural land. and income has been derived by that person who has an interest in the agricultural land by carrying on agricultural operations. The mere fact that some part of the agricultural operations required for raising the crop in question had been carried on by the former lessee till 2.9.1967 would not make the income derived by the petitioners by selling the sugar-cane in question non-agricultural income, since it has not been shown that without carrying on the necessarv agricultural operations after 2.9.1967 it would have been possible in these cases for the petitioners to derive the income in question.;