COMMISSIONER OF INCOME TAX WEST BENGAL II Vs. UKHARA ESTATE ZAMINDARIES PVT LTD
LAWS(CAL)-1970-8-2
HIGH COURT OF CALCUTTA
Decided on August 13,1970

COMMISSIONER OF INCOME-TAX, WEST BENGAL II Appellant
VERSUS
UKHARA ESTATE ZAMINDARIES (PVT.) LTD. Respondents

JUDGEMENT

P.B.Mukharji, C.J. - (1.) This is an income-tax reference under Section 66(1) of the Indian Income-tax Act, 1922. The question on which the answer of the Court is sought is as follows: "1. Whether on the facts and in the circumstances of the case the Tribunal was justified in excluding the sums of Rs. 22,197, Rs. 1,88,417 and Rs. 73,327 from the total income of the assessee for the years 1953-54, 1954-55 and 1955-56."
(2.) The facts giving rise to this question may now be briefly stated. The assessee Company was incorporated on July 3, 1920. The Company took over the Zamindari properties pertaining to the Ukhara estate which belonged to Rai Pulin Behari Lal Singha Bahadur and the late Gostabehari Lal Singha. The Company took lease of the extensive zamindari pertaining to the Ukhara estate and it also took assignment of the movables, including G. P. Notes and jewellery belonging to the members of lessors' family and the arrears of rents and cesses, debts, decrees etc., due by the tenants of the said estate. The said lease and assignments were taken by the Company by the indenture dated July 5, 1920. The properties passing to the Company were fully specified in the schedules appended to the said indenture. The consideration of the lease and assignment was fixed at Rs. 4,08,000 which was paid and satisfied by the Company by allotment and issue of 4080 fully paid-up shares of the Company to the lessors. The quit rent reserved by the lessors for the lease was Rs. 100 per annum. The Company undertook to pay the land revenue and cesses payable to the superior landlords in respect of the Zamindary. The lease was granted for a term of 999 years.
(3.) The Memorandum of Association of the assessee Company inter alia provided as follows: "3. The objects for which the Company is established are: (a) to take a lease or otherwise acquire, take over or undertake the Zamindaries Putnees Talooks lands and properties belonging to Rai Pulin Behari Singha Bahadur and the late Gostabehari Singha otherwise known as Ukhara estates for such salami price or consideration and upon rents, terms and conditions as are set forth in the draft agreement referred to in Clause 3 of the annexed Articles of Association. (b) to purchase, take on lease or otherwise acquire and to traffic in land house and other property of any tenure and any interest therein including Zamindaries, tenures, forests and plantations and fisheries and the rights of ferry and generally to deal in or traffic by way of sub-lease, exchange or otherwise with land and house property and forest and agricultural produce, timber, boats, rolling stock, machinery, cattle, fish and any other property, whether immovable or movable, and to encourage trade and traffic therein. (d) to take licenses or leases to prospect search for win get and quarry any ore m'etal or mineral substance of ail kinds in any part of India. (e) to carry on the trade or business of colliery proprietors, coal dealers, coke manufacturers, mica dealers, miners, smelters, engineers, lime burners and cement manufacturers in all their respective branches. (f) to carry on all or any of the business usually carried on by companies owning or holding land in all their several branches and in particular to lay out and improve, alter and develop by draining, cleaning, road making or otherwise any property of the Company and thereon to erect and construct or assist in the erection and construction of any buildings or works whatsoever and to pull down, alter and rebuild any existing erections or buildings required by the Company. (i) to develop and turn to account any land acquired by the Company or in which the Company is interested and to carry on the business of Zamindaries and landowners. (k) to purchase, take a lease, or in exchange, hire or otherwise acquire movable and immovable property and any rights or privileges which the Company may think necessary or convenient, for the purpose of its business, and in particular any lands, buildings, works, ponds, tanks, wells, reservoirs, minerals, easements, machinery, plant, stock-in-trade, rolling stock etc.";


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