Law:

Section:

-Sections 2(a) and 5 (k) - Madras Agricultural Income-tax Act, 1955 JUDGMENT Ramanujam J. --As the point arising in all these three tax cases is the same, they can be dealt with together, though they had been filed by different assessees. The question that is raised in these cases is as to whether the deduction under section 5(k) of the Madras Agricultural Income-tax Act towards the interest paid by the assessee in the previous year on the amounts borrowed and actually spent on the kind from which agricultural income is derived should be limited to an amount equivalent to 25% of the net agricultural income or the gross agricultural income. 2. According to the assessees, the expression "agricultural income", occurring in the second proviso to section 5(k), should be understood in the sense in which it has been defined in section 2(a) and, if so read the assessee will be entitled to the deduction of interest paid in the previous year on the amounts borrowed and actually spent on the land up to the limit of 25% of the gross agricultural income received during the year. The learned counsel seeks support for that position from the decision of Rajagopalan J. in Soundarapandian and Bros. v. Agricultural Income-tax Officer wherein it has been expressed : " I might, however, record that the learned Government Pleader conceded the claim of the petitioners, that the second proviso to section 5(k) was not correctly applied by the Agricultural Income-tax Officer. The Agricultural Income-tax Officer was wrong in allowing only 25 per cent, of the assessable agricultural income as a deduction within the scope of section 5(k). What should have been the basis of computation for relief was the agricultural income' as defined by section 2(a). " 3. Though the above observations proceed on the basis of a concession on the part of the revenue, we are of the view that the principle laid down therein sets out the correct legal position. The agricultural income has been ddefined under section 2(a) as meaning any rent or revenue derived from land and any income derived from such land by agriculture, etc. The word…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492