PROBHAT CHANDRA BARUA Vs. EMPEROR

JUDGEMENT

(1.) The appellant is zamindar of the Permanently Settled Estate of Gouripur, and he appeals to His Majesty in Council in the circumstances herein set forth. By an assessment note of the Income-tax officer of Dhubri dated 28 August 1925, the appellant was assessed under the Income-tax Act, 1929, to income-tax in respect of income arising from his said estate. On appeal the assessment was confirmed by order of the Assistant Commissioner dated 22 December, 1925. At the request of the appellant the Commissioner of Income-tax, Assam, acting under S. 66 of the said Act, submitted certain questions for the decision of the High Court. The question so submitted were three in number, and (as amended in the course of the hearing) they were in the following terms "1) Whether the following sources of income are agricultural and therefore exempted from assessment to Income-tax under S.4 (3) (viii) of the Act. [Then follow ten Items which it is unnecessary to set out here.] 2) Whether income derived from such of the above sources as were not taken into consideration at the time of fixing the jama at the Permanent Settlement is assessable for Income-tax purposes ? 3) Whether, having regard to the terms of the Permanent Settlement Regulation, Income derived from land in permanently settled states, subject to the exemptions provided by the Legislature, is liable to assessment to Income-tax?

(2.) In view of a diversity of judicial opinion already existing in regard to the proper answer returnable to the third question, both questions 2 and 3 were, by an order of the 21 May 1926, referred for decision of the Full Bench, the consideration of question 1 being in the meantime deferred. The case was argued before the Full Bench consisting of five Judges of the High Court, with the result that Ghose, Buckland and Panton, JJ., took one view and Mukerji and Suhrawardy, JJ., took a different and opposite view. The majority of the Judges held that questions 2 and 3 should both be answered in the affirmative. In the opinion of the minority, question 3 should be answered in the negative, from which answer it would follow that question 2 would not arise. By order dated 14 March 1927 the reference to the Full Bench was disposed of in accordance with the opinion of the majority of the Court.

(3.) The remaining question 1 was decided by the High Court on 11 May 1927. The appellant confined his claim for exemption to three items out of the specified ten items, but the High Court held that none of the three items were exempted as agricultural income, and accordingly question 1 was answered in the negative. By an order of the High Court dated 7 November 1927 the application of the appellant for leave to appeal to His Majesty in Council against the said judgments or orders of 21 May 1926, the 14 March 1927, and 11th May 1927, was granted. It is in these circumstances that the matter came before this Board.