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TMI Blog1925 (7) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... such payments were assessable to Income Tax having regard to the decision of this Court in the case of Maharaja Birendrakishor Manikya Bahadur v. Secretary of State A.I.R. 1921 Cal 262. An appeal was preferred by the assessee against the assessment of the Income Tax officer. The Assistant Commissioner of the Dacca Range rejected the appeal agreeing with the decision of the Income Tax officer. Accordingly an application was made to the Commissioner of Income Tax asking for a reference to this Court under the provisions of the section of the Act to which I have referred, and the Commissioner has, accordingly, referred the question in the terms which I have indicated. He agrees with the Income Tax officer that the assessment was rightly made a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendrakishor Manikya Bahadur v. Secretary of State A.I.R. 1921 Cal 262 relates. The first point was whether the nazar or salami payable in respect of a tenancy of waste land was assessable to Income Tax or exempt as being rent or revenue derived from land used for agricultural purposes within Section 2, Sub-section (1) (a) of that Act. The second question was the one which directly arises on the present reference, namely whether the nazar salami paid for the recognition of the transfer of a holding from one tenant to another was rent or revenue derived from land which was used for agricultural purposes within the meaning of Section 2, Sub-section (1) (a) of the then Income Tax Act. The learned Judges who heard the reference decided nazar or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e meaning of the expression as it occurs in Section 2 (1) (a) of the Indian Income Tax Act of 1922. 3. The result is that, in my opinion, the assessee is exempt from payment of Income Tax by reason of the provisions of Section 4, Sub-section (3) (viii) of the same Act. The question, therefore, which we refer for the decision of a Full Bench is whether the decision in Maharaja Birenirakishor Manikya Bahadur v. Secretary of State A.I.R. 1921 Cal 262 as regards salami paid for the recognition of a transfer of a holding from one tenant to another is correct and the question which arises for the decision of the Full Bench is whether nazar or salami paid by a tenant to a landlord for the recognition of the transfer of a non transferable holdin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he opinion expressed in that judgment for the reasons there given. Greaves, J. 8. The question which arises for the decision of the Full Bench is, whether nazar or salami paid by a tenant to a landlord for the recognition of the transfer of a non-transferable holding is rent or revenue within the meaning of the expression as it occurs in Section 2 (1) (a) of the Indian Income tax Act (Act XI of 1922). This question arose for the decision of the Court in the case of Birendrakishor Manikya v. Secretary of State A.I.R. 1921 Cal 262, and it was there decided that such payments were assessable to Income Tax. Doubts having been raised as to she correctness of that decision the matter has been referred to the Full Bench. Agricultural income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd and that it flows therefrom or from the ownership thereof; but in Birendrakishor Manikya v. Secretary of State: A.I.R. 1921 Cal 262 it is said that this is not so and that it cannot be deemed the return, yield, or profit of any land, but that it is money paid by the transferee to the landlord to purchase peace, so that he may not contest the validity of the transfer. 11. This no doubt is true, but it seems to me to ignore another aspect altogether, namely, that it is money which comes to the landlord by virtue of the fact that he is the owner of the land. Viewed in this light it clearly is derived from the land and is agricultural income within the definition thereof contained in the Income Tax Act, and as such exempt from assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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