1969 (1) TMI 8

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.... to U.P. large land holdings tax on the land holding held by it for the years 1959-60, 1960-61 and 1961-62. The tax assessed in respect of the first year is Rs. 72,167, in respect of the second year Rs. 74,248, and in respect of the third year Rs. 73,356. The East Hope Town Estate Co. Ltd. was taxed to Rs. 19,346 for the year 1959-60, Rs. 19,498 for the year 1960-61 and Rs. 20,080 for the year 1961-62. Their assessments were not disturbed up to the stage of appeal before the Income-tax Appellate Tribunal (hereinafter referred to as "the Tribunal "), which while dismissing the second appeal filed by the assessee aforesaid affirmed the appellate orders of the Appellate Assistant Commissioner and thus of the Income-tax Officer. The as....

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....re paid to the Government because the two companies aforesaid were using the land for which they are assessed for carrying on the business of tea plantation. Learned counsel submitted in this case that there is a direct relationship between the land holding and the business of manufacturing tea. The correct position with regard to the U.P. large land holdings tax is that it is a tax on holdings and not one on the annual value or capitalised value of the land, nor is it a tax on the person who holds the land : see Oudh Sugar Mills Ltd. v. State of U.P. It is admitted that the liability to pay the U.P. large land holdings tax exists on a person whether he cultivates his holding or not and whether he plants trees and shrubs on it or not. It....

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....th constituted the capital invested in its business. The Supreme Court repelled the submission made on behalf of the Travancore Titanium Product Ltd. on the ground that " every item of expenditure merely because it is connected with the trade may not necessarily be treated as a permissible deduction ". Their Lordships observed that a fairly reliable approach for determining what may be regarded normally as the expenditure laid out or expended wholly and exclusively for the purpose of the business was suggested in Strong and Co. of Romsey Ltd. v. Woodifield. That was a case of a brewery company owning a licensed house in which it carried on the business of innkeepers. The company had to pay damages to a customer who was, when sleeping in ....