Raja Nil Kanth Narain Singh vs Niharan Chandra Sarkar and another

Das, J.—We are concerned in this appeal with the construction of the 19th paragraph of the kabuliyat executed by the defendant in favour of the plaintiff. That paragraph runs as follows:- "in respect of the land covered by the kabuliyat or any portion thereof or in respect of the coal business, if any tax or road-cess be assessed on you by Government, then I shall pay the same." The plaintiff contends that the defendant is bound to pay him the road cess, the Health Board cess, and the income tax which the Government has imposed on him in respect of the royalty receivable by him from the defendant. The learned Subordinate Judge has come to the conclusion that the plaintiff would be entitled to recover from the defendant the Road cess and the Health Board cess levied on him by the Government but for the fact that he has not given any evidence as to the actual assessment.

So far as the income tax is concerned, the learned Subordinate Judge has negatived the plaintiff''s claim. The plaintiff has appealed against that portion of the judgment which has dismissed his claim; the defendant has presented a cross-objection and contends that the learned Subordinate Judge erred in holding that the plaintiff, if he had given evidence as to the actual assessment, would be entitled to recover the road cess and the Health Board cess levied on him by the Government.

I will first deal with the question of road cess. It was urged on behalf of the defendant that he is not liable to make good to the plaintiff the road cess levied on him by the Government, inasmuch as that cess has been levied in respect of the royalty receivable by the plaintiff from the defendant, and not in respect of the land covered by the kabuliyat nor of the coal business. It was argued that royalty is in reality the price paid for a portion of the soil, the payment whereof is distributed over a number of years; but it seems to me that the royalty represents the lessor''s share of the profits made from the coal business. In my opinion, the learned Subordinate Judge has correctly decided the question of liability against the defendant.

It was then urged on behalf of the plaintiff that the learned Subordinate Judge could have given him a decree by a mere arithmetical calculation. It was pointed out that there was evidence before the Court as to the royalty receivable by the plaintiff for the period in suit, and it was argued that all that the Court had to do was to calculate the sum payable by the defendant to the plaintiff at the rate of one anna per rupee. But under the agreement, the defendant is liable to make good to the plaintiff the road cess assessed on him by the Government. We do not know what the assessment was, and arithmetic will not solve the difficulty. The decree passed by the learned Subordinate Judge on this point must stand.

The question of the liability of the defendant for the Health Board cess stands exactly on the same footing. Section 10 of the Bengal Act (2 of 1912) provides that the expenses of the Mines Board of Health shall be charged to all owners of mines and all persons who receive royalties. The discussion again turns on whether royalty can be regarded as the lessor''s share of the profits made from the coal business. If, as I hold, it can be so regarded, then it is clearly a tax levied on the plaintiff in respect of the coal business. In my opinion the decision of the learned Subordinate Judge on this point is right and must be affirmed.

The only other point is as to the income tax levied, on the plaintiff. I am unable to agree with the plaintiff that any income tax was levied on the plaintiff in respect of the coal business. income tax is a personal tax. No doubt the royalty represents the lessor''s share of the profits made from the coal business, and it is one of the sources of the income on which the income tax is levied; but it is one thing to say that royalty is one of the sources of income on which the income tax is levied; and quite another thing that the income tax is levied in respect of the royalty.

In my opinion, the clause in the agreement on which reliance is placed by the plaintiff was intended to apply, and apply only, to such taxes as might be levied either in respect of the land, the subject matter of the lease, or in respect of the local business. It was not argued that the income tax was levied in respect of the land which is the subject-matter of the lease. In my opinion, it was not levied in respect of the coal business, though, in assessing the tax, the income tax authorities were entitled to take into consideration the income made by the plaintiff from the coal business. The plaintiff''s contention on this point fails and must be overruled.

I would dismiss this appeal with costs. The cross-objection must also be dismissed.

Adami, J.

I agree.