TMI Blog1948 (9) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... ome assessable to agricultural income-tax? On the grounds that malikana is not agricultural income the amount received by the assessee on this account has been assessed to the tax under the general income-tax Act which exempts agricultural income from taxation, it having been held that it is not agricultural income within the meaning of the Income-tax Act, 1922, which defines agricultural income as- Any rent or revenue derived from land which is used for agricultural purpose...... For the purpose of the Bihar Agricultural Income-tax Act, 1938, however, it has been held that malikana is agricultural income, with the result that the recipient has again been assessed on the amount received. The Bihar Agricultural Income-tax Act, 1938, defines agricultural income as any rent or income derived from land which is used for agricultural purposes........... Although in one Act income is used, and in the other, the word revenue there is no real difference in the two definitions. In order to bring the sum received as malikana within the definition of agricultural income the Revenue authorities must show either that it is rent or that it is income derived from land used for a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely as a subsistence or compassionate allowance for himself and his family. In Heeranund Sahoo v. Mussamut Ozeerun 9 W.R. 102 it was held that a right to malikana is not the same thing as a right to receive rent, but is a proprietary right constituting an interest in land. In Mussamut Ozeerun v. Baboo Heeranund Sahoo (7 W.R. 336), it was held that malikana is a money payment, and neither rent nor maintenance; in other words, it is to be regarded like bond or other debt, the non-payment of which, within a certain legal period, bars an action to recover it. In Bhoalee Singh v. Mussamat Neemaoo Behoo ([1869] 12 W.R. 498) a Bench of three Judges held that Malikana is not rent, nor his it the elements of rent. Later, in Syed Shah Najamuddin Hyder v. Syed Zahid Hussein ([1907] 8 C.L.J. 300) also it was held that malikana is not a claim for rent. A passage in the judgment of Garth C.J., in Mullick Abdool Gufoor v. Muleka ([1884] I.L.R. 10 Cal. 1112, 1125) was referred to by the learned Advocate-General: There is nothing in principle, so far as we can see, to distinguish a malikana right from a right to receive rents, or the dividends payable upon Government paper. What the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s expressly parted with them and to accretions. There is no authority for the proposition that he is entitled to the underground rights and has right to accretions has been negatived in Saudamini Dassya v. Secretary of State for India [1924] I.L.R. 50 Cal. 822. In that case Rankin J., as he then was, held that although the right to received malikana may be described as a quasi rent charge it is not a tenure or dominium and that when a proprietor was dispossessd in consequence of his refusal to enter into an engagements for the payment of the revenue demanded in 1793 his interest in the land was extinguished. The question may also be looked at from another point of view. malikana is payable whether the land in respect of which it was originally granted exists or not. That is not disputed. How can it be said to be derived from land used for agricultural purposes in case where the land no longer exists or no longer exists as agricultural land? The question whether malikana is income derived from land must I think, be determined in accordance with the principle laid down by the Privy Council in Commissioner of Income-tax v. Raja Bahadur Kamakhaya Narayan Singh (Privy Council Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retained the rights of a small annual cash payment by virtue of their position as the old 'pargana lord.' This cash allowance came to be called the malikana. The villages otherwise became quite independent and the exclusive property of the purchasers, grantees or transferees. 8. The amount of the malikana was fixed by a settlement decree and is not variable. It is payable whether the land on which it is supposed to be charge is used for agricultural purposes or not or whether it yields any profits or not. It is admitted that suits for the recovery of this due are cognisable by the Civil Courts and not by Revenue Courts. This being so it is impossible to describe this due as rent or as agricultural income. There is no relation of landlord and tenant between the appellant and the proprietors who are liable to pay this amount...... Their Lordships observed: It may be conceded that it would never have become payable to the ancestors of the assessee had they not been feudal proprietors of land. But that does not mean that it is now rent or revenue derived from the land. On the contrary it is paid just because the original proprietors relinquished their claims to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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