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TMI Blog1955 (7) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... d transferred to the maintenance allowance of the lady constitutes maintenance allowance within the meaning of the Orissa Agricultural Income- tax Act 1947? 2. We will immediately take up the first question. The assessee is Raja of Kanika. It is too well-known a fact that he is one of the biggest landlords of Orissa, his estate extending over nearly 400 square miles and that he has substantial agricultural income even though he has also other sources of income. The present question is with reference to the exemption from agricultural income-tax under section 6(f) of the Orissa Agricultural Income-tax Act, 1947, of the repairing charges of the big residential buildings of the assessee situate at Raj Kanika. The relevant portions of section 6 are as follows: 6. The agricultural income-tax referred to in sub-clause (1) of clause (a) of section 2 shall be deemed to be the sum realised in the previous year on account of agricultural income mentioned in the said sub-clause (1) after making the following deduction: (f) the amount paid in the previous year on account of the repairs to any capital assets used in connexion with the collection of rents due in respect of the land fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on with the collection of rents due in respect of the land, as it is necessary for the land-owner to supervise over the collection of rents due from the tenants residing in a vast estate, in our opinion, the condition necessary to bring the case under clause (f) of section 6 is satisfied and the entire repairing charges are to be deducted. In the present case the estate is considerably large and the building is situate within the estate. There is no doubt in our mind if the land-owner requires the house for his residence in connexion with the collection of rents, it is open to the assessee to have his own residential buildings according to his own ideas of comforts. Such ideas differ from man to man and amongst men of different status. The assessee has got the liberty to build his house with all equipments and facilities of modern comforts and may therefore have a drawing-room, a dining-room a billiard-room and a decent house for guests. If of course the assessee is desirous of living a very simple life without caring for modern comforts he may have his building according to his own fashion. It is certainly not for the Income-tax Authorities to enquire what exactly would be the por ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Patna High court consisting of five judges in the case of Rajendra Narayan Bhanja Deo v. Commissioner of Income-tax, Bihar and Orissa*. It is important to observe that this very residential house of the Raja of Kanika was also the subject matter of reference before the Full Bench. The then Raja of Kanika, Rajendra Narayan Bhanj Deo, being the assessee, pressed for exemption from general income-tax, the notional income of the entire buildings at Raj Kanika house for his residential purposes under the proviso to clause (c) of sub- section (1) to section 2 of the Indian Income-tax Act 1922, as being agricultural income. In affirming the decision of Sir Dawson Miller, C.J., Sir Courtney-Terrell, C.J., observed as follows: The assessee, the Raja of Kanika, derives rather more than one-half of his large income from agricultural rents. He has a residential palace upon his estate which extends over about 400 square miles, in which certain quarters are allotted to certain of his zamindari staff. The moment they, the Authorities, find that the house is required by reason of dwelling house, or store house, or other house, it is beyond their jurisdiction to determine what portion of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e deducted under the provisions of clause (g) of section 6 of the Bihar Agricultural Income-tax Act, 1948. The clause runs thus: any expense incurred exclusively on the maintenance of any capital asset purchased or constructed before this Act came into force if such maintenance is required in connection with the collection of rents due in respect of the land from which such agricultural income is derived. Their Lordships felt bound by the Special Bench decision referred to above and had therefore to answer the reference accordingly in favour of the assessee even though Sarjoo Prosad, J., (as he then was) expressed in his judgment that he had hesitation in following the Special Bench decision on account of the difference in language of section 6(g) of the Bihar Act and section 2(1)(c) of the Indian Income-tax Act. With respect to the learned Judges, we are of the view that the difference in language of the two provisions is not such as to affect the principle decided by the Full Bench decision of the Patna High Court and followed by the Special Bench while deciding the case under the Bihar Agricultural Income-tax Act. 8. Mr. Dhal however contends that when the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be prescribed . The relevant rule prescribing the deduction is contained in the Orissa Agricultural Income-tax Rules 1948. Section 3(2) runs as follows: (2) In addition to the deductions specifically allowed under section 6, the following deduction provided under clause (k) of that section shall be allowed: Maintenance allowance actually paid to the following members of the proprietor's family owning an impartible estate, provided that the aggregate of the allowances so paid shall not exceed one-fifth of the net income of the estate, namely, (b) the widow of a previous proprietor so long as she does not remarry: The deduction claimed does not manifestly exceed one-fifth of the net income of the estate. There is no question about the position that in fact this amount was actually spent on behalf of the widow of the previous proprietor for her necessities. There is no doubt about the genuineness of the account showing the transfer of these items to the maintenance allowance of the widow. Medical expenses and the expenses for essential religious ceremonies according to the status of the widow are well within the meaning of the maintenance expenses. The only contention ..... X X X X Extracts X X X X X X X X Extracts X X X X
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