A. K. T. K. M. VISHNUDATTA ANDHARJANAM REPRESENTEDBY. D vs COMMISSIONER OF AGRICULTURAL INCOME TAX,TRIVANDRUM. Supreme Court, 05-05-1970
| Judge | GROVER,A.N. |
| Parties | A. K. T. K. M. VISHNUDATTA ANDHARJANAM REPRESENTEDBY. DCOMMISSIONER OF AGRICULTURAL INCOME TAX,TRIVANDRUM |
| Docket Number | Appeal Civil 2327-2328 of 1968 |
| Date | 05 May 1970 |
| Court | Supreme Court (India) |
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PETITIONER:
A. K. T. K. M. VISHNUDATTA ANDHARJANAM REPRESENTEDBY. D.
Vs.
RESPONDENT:
COMMISSIONER OF AGRICULTURAL INCOME TAX,TRIVANDRUM
DATE OF JUDGMENT:
05/05/1970
BENCH:
GROVER, A.N.
BENCH:
GROVER, A.N.
SHAH, J.C.
HEGDE, K.S.
CITATION:
1970 AIR 2055 1971 SCR (1) 535
1970 SCC (2) 165
CITATOR INFO :
E 1980 SC 71 (12,14,17)
ACT:
Income or capital-Teak trees removed by their roots and
sold-Sale receipts whether income or capital.
HEADNOTE:
in the course of the appellant’s assessment under the Kerala
Agricultural Income-tax Act, 1950, for the years 1963-64 and
1964-65, the Agricultural Income-tax Officer included in the
appellant’s income an amount realised from the sale-of teak
trees which had been planted in the year 1946-47 and were
removed from the appellant’s land and sold during the
assessment years. The Appellate Assistant Commissioner as
well as the Tribunal confirmed the assessment. On a
reference under s. 60(1) of the question whether the receipt
from the sale of teak trees was capital in nature and
exempted from agricultural income-tax, the High Court found
against the appellant.
On appeal to this Court
HELD:Allowing the appeal,
The form of the question referred to the High Court itself
showed that the trees were cut and completely removed from
the land together with their roots for the purpose of
planting rubber. There wag no question of any further
regeneration or growth of the trees which had been cut and
removed. In other words there was no possibility of
recurring income from these trees.
The sale of such trees thus affects capital structure and
cannot give rise to a revenue receipt.
V. Venugopala Verma Rajah v. Commissioner of Income-tax,
Kerala C.A. 1810 of 1967 decided on 24-9-69; The
Commissioner of Income-tax, Bengal v. Messrs Shah Wallace
and Company, 6 I.T.C. 178; Commissioner of Income-tax,
Bombay South v. N. T. Patwardhan 41 I.T.R. 313; referred to.
The profit motive is not decisive of the question whether a
particular receipt is capital or income. An accretion to
capital does not become taxable income merely because an
asset is acquired in the hope that it may be sold at a
profit [538, B-E]
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