1973 (6) TMI 16

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....he trees and the value of the latex that can possibly be extracted therefrom by slaughter-tapping and whether the latter is assessable as agricultural income in the bands of the owner who sold the trees ? 2. Whether the income attributed to the centrifugal process, etc., is assessable as agricultural income ? 3. Whether in the absence of a machinery to harmonise and reconcile the assessment and fixation of the quantum of assessable income and apportioned expenditure under the State and Central enactments, the agricultural income-tax department is justified in not following or ignoring the basis and assessment of the Central income-tax authorities and disallow legitimate expenditure apportioned to it by adopting different methods, inco....

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....usefully extract the relevant portions of that judgment here: "For the relevant accounting period for the year 1962-63, the assessee received Rs. 32,250 pursuant to the agreement, annexures 'D' and 'D-1' and for the assessment year 1963-64 a sum of Rs. 45,750 pursuant to the agreement, annexure 'D'. The Tribunal has assessed for the two years these amounts treating the entirety of these amounts as agricultural income of the assessee. The question is whether the whole of the above amounts can be treated as agricultural income. On a reading of the two agreements there can be no doubt that the amounts that have to be paid by those who entered into agreements with the assessee represent payments for permitting them to take the latex as well ....

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....om the above decision of M. S. Menon C.J. and Govindan Nair J. have been set out in another case decided by us today [I.T.R. No. 16 of 1972--K. C. Jacob v. Agricultural Income-tax Officer [1977] 110 ITR 402 (Ker)] as follows: "(i) The consideration paid by the purchaser allowed to 'slaughter-tap' represents payment for permission to take latex as well as for permission to cut and remove the trees. (ii) There is an element of payment towards capital, namely, the value of the trees which are ultimately to be cut down. (iii) There is also payment towards latex which represents agricultural income. (iv) The amount of consideration received by the owner for the permission given by him to 'slaughter-tap' and to cut and remove the tree....