Recurring covenant payments treated as taxable income, not agricultural income, because they were periodical returns from a definite source.

A recurring payment under a personal covenant, even when secured by a charge on land, was treated as taxable income rather than agricultural income. The payment did not constitute rent or revenue derived from land, because it arose from the covenant itself and not from land use or ownership. It was also not characterised as an instalment of a capital sum; the transfer of the estate in exchange for a life annuity showed that the periodic receipts were intended as income in the recipient's hands. The charging provision's word "income" was not confined by "profits and gains", and a periodical monetary return from a definite source fell within it.

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Issues: Whether the annual payment received under the covenant was agricultural income exempt from tax; whether the annual payment was a capital sum payable in instalments or income taxable under the Act; and whether the word "income" in the charging provision was confined by the words "profits and gains".

Analysis: The annual payment was not rent or revenue derived from land. It arose from a personal covenant to pay money, and the fact that the obligation was secured by a charge on land did not make the receipts agricultural income. The payment was also not an instalment of a capital sum. The transferor exchanged an estate for, among other consideration, a life annuity, and the form of consideration showed that the recurring payments were intended to be income in his hands rather than deferred capital. The word "income" in the Act was not confined by the accompanying words "profits and gains". A periodical monetary return from a definite source is income, and the life annuity here derived from the covenant taken in exchange for the estate.

Conclusion: The payment was not agricultural income and was taxable as income under the Act.

Final Conclusion: The appellant's receipt under the life covenant was held to be taxable income and not exempt agricultural income, so the appeal failed.

Ratio Decidendi: A recurring payment under a personal covenant, even if secured by a charge on land and connected with the sale of property, is taxable income if it is a periodical return from a definite source and not rent or revenue derived from land.

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