Chandra Narayan Laik, J. - (1.) This is one more colliery case on a less complicated Act, but it involves questions of nicety. The imposition of cess on the sale price of the water discharged from the coal mine, paid for its use by the neighbouring glass factory, has set the legal ball rolling. Shortly, the facts are : The petitioner, a coal company, is the owner of a colliery near Asansol in the District of Burdwan. As usual in coal mines, the percolated water which accumulated in the petitioner's colliery was pumped out and discharged at the surface, to prevent inundation of the same. For the year 1958 -59, a sum of Rs. 42,073/ - was received by the petitioner as the sale price of the water, so pumped out The profit and loss account of the said year shows a sum of Rs. 5,82,000/ - and odd as the sale price of the coal and the said sum of Rs. 42,072/ - as miscellaneous income being charges for water supply. For the first time, the petitioner claimed deduction of the sale proceeds of the water from the assessment unlike previous years.
(2.) The Cess Deputy Collector, Burdwan assessed the petitioner in respect of the colliery with the Road and Public Works Cess under chapter V of the Cess Act, 1880 (Bengal Act IX of 1880 hereinafter referred to as the Act). He called on the petitioner to pay the amount of cess on the said amount of Rs. 42,000/ - and odd, treating the same as one of the items making up the total annual net profits from the mine being "admittedly derived from the coal mine". . . . "in the proceeds of extracting coal and by use of the company's instruments, equipments and stuffs". He observed that the petitioner in earlier years did not make such claim. The decision of the Cess Deputy Collector was not interfered with in the appeal by the collector, Burdwan, as the assessment according to him, was not contrary to the provisions of the Cess Act and Rule 103 of the Rules and because the income was received by the employment of the machinery and staff attached to the mine.
(3.) The petitioner's revision petition failed before the Commissioner of Burdwan Division. He inter alia observed : The water had to be pumped out of the mine, otherwise the mine would be drowned and the colliery, as such, would cease to work. Therefore, every bit of machinery which took part in this action of pumping out and disposal of this water and every action taken for the means thereof were not only absolutely necessary for the continuation of the working of the mine, but were actually a part and parcel of that vast conglomeration of the various commitments, movements and actions taken for the removing of coal from beneath the surface of the earth for the ultimate profit of the management. Therefore, this removing of water certainly came with in the scope of rule 103 which deals with the valuation of movable properties under chapter V of the Act and certainly also came within the scope and ambit of Ss. 6 and 72 of the said Act. His further observation in the next paragraph of the order is : it is all very obvious and logical that if this water which is pumped out to save the colliery from drowning is then sold at a vast profit, it certainly comes within the ambit of the term "gross earnings" and, as such, is liable to cess. The suggestion of the lawyer appearing for the petitioner, appeared to the Commissioner as naive.;