LexW.O. HOLDSWORTH AND OTHERS versus THE STATE OF UTTAR PRADESH
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
1957
{.er,tember 4.
296
SUPREME COURT REPORTS
[1958]
W.O. HOLDSWORTH AND OTHERS
v.
THE STATE OF UTTAR PRADESH
BHAGWATI, S. K. DAS AND GAJENDRAGADKAR J.J.
Agriniltural lncome-tax-Wi/1-Triust-Annuities-Land held
hr trustee, \Vhether on behalf of annuitants-Nature of interest of·
annuitants. whether joint-Indian Trusts Act, 1882 (fl of 1882),
s. 3--U. P. Agricultural Income-tax Act, 1948, (U. P. Ill of 1949),
ss. 2( 11 ), 3, 11 (I).
Sec~ion 11(1) of the U. P. Agricultural Income-tax Act, 1948,
provided : "Where any p'crson holds land, from which agricuitural
incon1e is derived, as a con1mon manager appointed under any la\V
for the tin1c heing in force or under any agreement or as receiver9'
administrator or the like on behalf of persons jointly interested in
such land or in the agricultural income derived therefrom, the
aggregate of the sums payable as agricultural income-tax by each
pers0n on the agricultural income derived from such land and
received by hin1, shall be assessed on such common manager,.
receiver, administrator or the like, and he shall be deemed to be
the assessee in respect of the agricultural income-tax so payable
by each such person and shall be liable to pay the same."
The appellants were the trustees of an estate settled on trust
under a will which inter alia provided that the trustees were t<>
take possession of the trust properties and to manage the same-
with all the powers of absolute owners and to pay the annuities
to certain persons. The assessing authority assessed the appel-
lants to agricultural income-tax upon the total agricultural income
received by them. overruling their contention that the tax should
be computed in accordance with the method of computation laid
down ins. 11(1) of the Act and that they should be called upon to
pay the aggregate of the sums payable as agricultural income-tax
by each of the annuitants.
Held : (I) that the trustees who were the legal owners of the
trust property did not hold the land from which agricultural in-
come was derived, on behalf of the annuitants and that each of
the annuitants was separately or individually interested in the
agricultural income derived from the land comprised in the trust
estate to the extent of the annuity payable to him.
(2) that s, 11(1) of the Act was not applicable to the case and
that the appellants were liable to pay agricultural income-tax
upon the total agricultural income received by them.
CIVIL APPELLATE JURISDICTION: CIVIL Appeal No.
389 of 1956
S.C.R.
SUPREME COURT REPORTS
297
Appeal by special leave from the judgment and
order dated April 19, 1955, of the Allahabad High
Court in Agricultural Income-tax Miscellaneous Case
No. 202 of 1952.
G. S. Pathak and G. C. Mathur, for the appellants.
K. L. Misra, Advocate-General of Uttar Pradesh, and
C. P. Lal, for the respondent.
1957. September 4. The Judgment of the Court
was delivered by
BHAGWATI, J.-This appeal with special
leave
against the judgment of the High Court of Judicature
at Allahabad raises a question of the interpretation of
s. 11 (1) of the U.P. Agricultural Income-tax Act, 1948,
Act III of 1949 (hereinafter referred to as "the Act')
The appellants are the trustees of the estate settled
on trust under the
last will and testament
dated
May 17, 1917 of one.J. J. Holdsworth which, interalia,
comprised of a certain zamindari estate known as the
Lehra
Estate situate in the District of Gorakhpur,
Uttar Pradesh.
The clauses of the will so far as they are relevant for
the purpose of this appeal provided that the trustees
were to take possession of all real property in the
United Provinces of Agra and Oudh and elsewhere in
British India
(including the houses
at Lehra and
Gorakhpur and the grounds thereof) and all live and
dead stock in or about his estate in British India or
any buildings thereon and the contents of any houses
or stabling in British India belonging to him (which was
called his estate) and manage the same in all respects
and in such manner as they shall deem most advan-
tageous and with all the·powers of absolute owners.
The trustees were to stand possessed of the net rents
and profits of the settled estate after payment of the
Government land revenue tax, and of all management
expenses, upon trust to pay thereout certain annuities
to 12 annuitants therein mentioned. If the net rents
and profits of the said estate were less than seventy
thousand rupees in any yeExcerpt shown. Read the full judgment & AI analysis in Lexace.