TARUN CHANDRA BARUA vs COMMISSIONER OF Income Tax.

A. RAGHUVIR C.J. - The following question is referred to this court under sub-section (2) of section 256 of the Income Tax Act. The question reads as under :

"Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the land in question was a capital asset within the meaning of section 2(4A) of the Indian Income Tax Act, 1922, and that there was capital gain subject to Income Tax ?"

In this reference, Tarun Chandra Barua is an assessee. He owned 175 bighas of land under Dag. No. 36 of village Fatasil Ambari area. The question in the instant case is relevant only to 25 bighas of land acquired under the Land Acquisition Act 1 of 1894. It appears that 5 bighas of land was acquired and the market value of the land was determined at Rs. 5,000 per bigha. Again 20 bighas of land was acquired for laying a road. The market value of the land was determined at Rs. 7,000 per bigha. In total, for the land acquired, the assessee received a sum of Rs. 1,65,000.

The question relates to the user of the land, viz., whether it was agricultural land or non-agricultural land.

The assessee, before the Income Tax Officer, made a declaration on July 24, 1965, and in that he stated unequivocally that the land was not agricultural land. We quote his declaration : "I won the case in lower court proving that the land in question was not in possession of any one and it was a purely a vacant plot of land without cultivation by anyone or myself". The declaration was accepted by the Income Tax Officer and the land was held to be non-agricultural land. It is on that premise that Rs. 1,00,000 was added towards capital gains.

The assessee filed an appeal having changed his stand and contended that the land is agricultural land. The Appellate Assistant Commissioner of Income Tax held that the appellant who was described as "a happy-go-lucky young man, is the son of late Dr. Hemchandra Baruah who was the Principal of the Medical College at Dibrugarh. The present appellant, Shri Tarun Chandra Baruah, grew up under the patronage of his father. It is also said that the present appellant, Shri T. C. Baruah, had an elder brother. But both the father and the elder brother are now dead. It is now made out that the present appellant, Shri T. C. Baruah, had no occasion of seeing the land and, therefore, he was not well informed when he gave it in writing that the land was not agricultural land" and further : "From the Jamabandi, the certificate from the Assistant Settlement Officer, Gauhati, and from my personal inspection". For the said reasons it was held that the land is agricultural land and that the sale proceeds of the land should not attract capital gains. The appeal was allowed and on further appeal before the Income Tax Appellate Tribunal, the finding was seriously assailed by the Revenue.

The Tribunal, having regard to the declaration made by the assessee, held that neither 5 bighas nor 25 bighas of land could, when acquired by the Government, have been put under cultivation. The Appellate Assistant Commissioner, when he inspected the land, could not have seen the land as under cultivation, as, by that time, a road perhaps was laid and therefore, the land was held as agricultural land within the meaning of section 2 (4A) of the Act.

We see that a finding is recorded with reference to the village records, or Jamabandi records. The finding reached by the Tribunal, it is needless to mention, is a finding of fact and cannot be disturbed by this court by going into the finding that has been recorded. If authority is needed, it is M.M. Ipoh and Others Vs. Commissioner of Income Tax, Madras, "... the High Court, in a reference u/s 66 of the Income Tax Act, was incompetent to disturb what was essentially a finding of fact recorded by the Tribunal and arrive at another finding". On the question that is referred, we hold in the affirmative, that the land in question is a capital asset within the meaning of section 2 (4A), in favour of the Revenue and against the assessee. No costs.