Paripoornan, J. - (1.) Special leave granted in all cases. In a few cases there is delay in filing the special leave petitions. The said delay is condoned.
(2.) This batch contains 32 appeals. They are filed in 20 different sets. The same assessee has filed more than one set of S.L.P. Broadly speaking two questions were posed for consideration in this batch of appeals. They are (i) exigibility to capital gains (tax) when old and unyielding rubber trees were sold by the assessees; (ii) whether the rubber replantation subsidy received by the assessee is a revenue receipt or not. Only in a few cases both the questions arise for consideration. In some other cases, one or the other of the above questions arise for decision.
(3.) The appellants are assessees to income-tax. They owned rubber estates. During the accounting years relevant to the assessment years in question for which they were assesseed (1968-69, 1969-70, 1971-72, 1972-73, 1973-74, 1975-76, 1976-77, 1977-78 and 1978-79, as the case may be), the assessees sold old, unyielding and uneconomic rubber trees. The Income-tax Officer, brought to tax the difference in amount between the sale price of the uneconomic rubber trees sold and the price nationally fixed for rubber trees as on 1-1-1954 and 1-1-1964, as the case may be [S.55(2)]. It was on the basis that capital gains accrued to the assessee when old and uneconomic rubber trees were sold by them. He worked out 'the capital gains' on the basis of a principle stated in his order. The plea put forward by the assessees was that the rubber trees when sold were uneconomic and unyielding and were useless, but on the other hand, they were fully yielding on the respective valuation date specified in S.55(2) of the Act i.e. 1-1-1954 or 1-1-1964, as the case may be, and in this view of the matter, no capital gains arose or accrued to the assessee when the old and unyielding rubber trees were sold. The principle adopted to arrive at the capital gains was also assailed. The Income-tax Appellate Tribunal in a majority of cases, accepted the plea of the assessees, and directed the Revenue to delete the capital gains on the sale of old and uneconomic rubber trees. The basis or principle on which capital gains was worked out by the officer was interfered with by the Appellate Tribunal. However, the High Court in the main case dealt with by it. ITR Nos. 111 and 49 of 1981 upheld the principle of valuation adopted by the officer. This was followed in all the later cases including the cases in the present batch of appeals. The High Court also took the view that 'capital gains' arose or accrued when old and uneconomic rubber trees were sold by the various assessees. It was concluded that the levy of capital gains in the circumstances, was sustainable. Similarly, the assessee had received rubber plantation subsidy from the Rubber Broad. The Revenue treated the same as revenue receipt and taxed the same as income of the assessee. The High Court in this batch of appeals upheld the said view of the Revenue.;