TMI Blog1962 (2) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... receipt liable to be taxed. An appeal was taken to the Appellate Assistant Commissioner objecting to the assessment of this amount on the ground that the amount received from the Government was with the object of helping the running of the rubber estate and its payment was also conditioned by the requirement that a certain area of rubber estate should be replanted with high-yielding rubber trees. It was accordingly claimed that this was a capital receipt not liable to be taxed. This contention was not accepted by the Appellate Assistant Commissioner. In the further appeal to the Tribunal, identical contentions, though in a different form, were pressed, but the Tribunal, after examining the provisions of the Ordinance referred to, observed : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trees, the payment as provided in the Ordinance was made without any attendant conditions. It was contended by the learned counsel that having regard to the fact that the amount was to be expended for the purpose of a capital nature, it should be inferred that the receipt was of a capital nature. We fail to appreciate the soundness of this argument. To accept the argument would constitute a reversal of the normal procedure of ascertainment of the nature of a receipt. What we have to discover is the source of the receipt. If the source from which the receipt is obtained is of a revenue nature, it should necessarily follow that the receipt would also bear that character. The manner in which the money was utilised, though it might indicate the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee firm. So long as replanting expenses are allowed as payments of revenue nature, replanting cess refund also is a receipt revenue in nature and will have to be taxed. The suggestion contained herein seems to be that this receipt had been written back in the adjustment statement, that is to say, that an amount of expenditure relating to replanting having been allowed, this receipt is now brought to tax. We are unable to gather from the arguments before us whether in any previous year any expenses on this head were in fact allowed in the assessment. But the absence of any information on this head does not however affect the decision in the present case. The moneys collected as cesses under clause 7 of the Ordinance are pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... em individually in the fund against the expenditure actually incurred since the 1st of January, 1946, by the participants concerned on the replanting or new planting of high yielding rubber tress.... Similar conditions are found in the Second Schedule which relate to moneys collected under clause 7(5) of the Ordinance by way of customs duties and deposited in Fund A. It is obvious from the provisions of the Ordinance that the fund has been created out of moneys collected either as cesses or as export duty which under clause 7(5) of the Ordinance have been declared to be utilisable as part of the fund created under that Ordinance. We may also refer to a further Ordinance of the year 1955 which extended the scope of the original Ordinan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounts were realised either from the assessees or from the exporters of rubber and depended upon the quantity of rubber exported by each of the estates in question. It was this amount of cess or duty that was carried into Fund A and placed to the credit of the estate owner. After deducting a portion towards the cost of administration of the fund, the balance was earmarked for payment to the owner of the plantation to the extent to which he complied with certain conditions imposed upon him. That the money was intended to be utilised or to be set off against sums expended by the plantation owners in the replanting of the estates has no relevance to our minds in the determination of the nature of the receipts. It is perfectly clear that the sou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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