royalty and taken higher salami and therefore the major portion of the sum of Rs.
The area companyered by that lease though larger included substantially the area leased out subsequently.
2,20,000 was paid by the Company to the assessee as salami and as such it was a capital receipt and number taxable.
While making the assessment for the year 1944 45 the Income tax Officer took the view that the assessee had chosen to take large sum by way of salami white granting the lease in the year 1944 and had accepted lesser rate of royalty, the salami represented an advance payment of royalty.
20,000 on the basis that for the other leases the rate agreed upon was Rs.
The terms of the 1941 lease were that salami was payable at the rate of Rs.
100/ per acre and royalty at the rate of /8/ annas per ton.
Appeal from the judgment and order dated December 22, 1965 of the Patna High Court in Misc.
On appeal by the Revenue the Appellate Tribunal by an order dated August 7, 1952 remanded the case to the Appellate Assistant Commissioner for finding whether there were circumstances to indicate that the salami was really receipt of income.
The Appellate Assistant Commissioner made a report dated April 12, 1956.
The High Court proceeded to assess the salami at Rs.
20,000 which was number assessable to tax but the remaining amount of Rs.
5,000 out of the sum of Rs.
2,25,000 as Dewani Negi and Moharkari and the balance of Rs.
2,20,000 had been taken in exchange of royalty that would have accrued during the period of lease.
2,20,000/ was the income of the assessee assessable to tax under the provisions of the Income tax Act ?
He treated Rs.
CIVIL APPELLATE JURISDICTION Civill Appeal No.
22/ per acre.
He gave a finding that the assessee had intentionally accepted lower.
C. Chagla and B. P. Singh.
for the appellant.
Judicial Case No.
2,20, 000 the amount which companyld be regarded to be salami and treated as a capi tal receipt companyld reasonably be estimated at a sum Rs.
The Tribunal by an order dated July 26, 1956 allowed the appeal of the Revenue and restored the order of the Income tax Officer.
On January 22, 1944 the assesses granted a lease of certain mining rights to Aluminium Production Company Ltd. in respect of 171 03 acres of land for a period of 30 years.
The main terms were as follows Salami inclusive of Moharkari and Dewani Negi amounting to Rs.5,000/ Rs.
2,20,000 was treated by him as income of the assessee, and the assessment was made accordingly.
on appeal the Appellate Assistant Commissioner held that the amount of Rs.
101 of 1962.
The original assessee was Maharaja Partap Udainath Sah Deo the holder 1 of an impartible estate.
2, 00,000 was revenue receipt and was taxable as such.
Previously the assessee had granted a prospecting lease of 311 acres of land to the same Company on March 20, 1941 fox a period of one year.
iV Minimum royalty Rs.
Jagadish Swarup Solicitor General J. Ramamurthi.
N. Sachthey and B. D. Sharma for the respondent.
2,25,000/ Rent /8/ per acre Royalty /6/ per ton.
1732 of 1967.
The Judgment of the Court was delivered by Grover, J. This is an appeal from a judgment of the Patna High Court in a reference made to it under s. 66 1 of the Income tax Act, 1922, by the Appellate Tribunal by which the following question of law was referred for determination by the High Court Whether on the facts and circumstances of this case, the Tribunal was right in holding that the sum of Rs.
