Case: Commissioner of Wealth Tax, Andhra Pradesh Vs. Officer-In-Charge (Court of Wards), Paigah

shall be lawful for the Taluqdar, and in case a taluka is under settlement, for the Commissioner of Survey Settlement or Commissioner of Land Records after giving a hearing to the landholder to prohibit its appropriation for any particular purpose and record reasons therefor and to summarily evict the holder who may have appropriated the said land to prohibited purpose."12. Provisions of the Andhra Pradesh Land Revenue Act seem to involve quasi-judicial proceedings, or at least, an enquiry into the purposes for which land to be assessed has been appropriated. The Full Bench of the Andhra Pradesh High Court has held these entries to be "strong prima facie evidence", and it practically decided the case on the basis of these entries. But the difficulty seems to us to be that the taxing authorities had given a categorical finding that the land under consideration had neither been used for an agricultural purpose nor was it ever intended to be so used. It may be that this finding was based on no evidence or was based on the circumstance that the land appeared to have been kept, as the environs of a huge palace, unused for any agricultural purpose. It may be that the past history of such lands could give rise to some guess work that no agricultural user was intended by the owners of the Begumpet Palace. But, is it possible to reach a categorical finding or conclusion on the basis of general notions, based on past history of the way in which such lands were treated by their aristocratic owners ? At any rate, there presumably was some, possibly quasi-judicial, enquiry at the time of classification of land as "agricultural" under the provisions of section 50 of the Andhra Pradesh Land Revenue Act. There must have been some evidence given for such a classification.Learned counsel for the assessee-respondents submitted that no evidence had been led on the question of intended user before the taxing authorities as the "prima facie evidence", provided by the entries in the revenue records, was considered enough. It has, however, to be remembered that such entries could raise only a rebuttable presumption. It could, therefore, be contended that some evidence should have been led before the taxing authorities of the purpose or intended user of the land under consideration before the presumption could be rebutted. If the "prima facie" evidence of the entries was enough for the assessee to discharge his burden to establish an exemption, as it seemed to be, evidence to rebut it should have been led on behalf of the department.13. We think that this aspect of the question was not examined by the Full Bench from a correct angle. Although it seems to have based its conclusion primarily on the "prima facie" evidence provided by the entries under section 50 of the Andhra Pradesh Land Revenue Act, it had also used other indicia which were really not very helpful. They had a bearing on potentialities for agricultural user. The Full Bench had, however, not recorded a finding that the conclusion reached by the taxing authorities, that the land was never even intended to be used for an agricultural purpose, rested on no evidence at all. It had not given its reasons for rejecting this finding of the Tribunal.14. We also think that the Full Bench was not correct in adopting the view expressed in Sarojini Devis case by the Madras High Court where it was held that it was enough to show that the land under consideration was capable of being used for agricultural purposes. This erroneous view also seems to us to have affected the conclusion of the Full Bench on what was essentially a question of fact. It had led the Full Bench into giving excessive weight to considerations which had a bearing only on potentialities of the land for use for agricultural purposes.For the reasons already given, we do not think that the term "agricultural land" had such a wide scope as the Full Bench appears to have given it for the purposes of the Act we have before us. We agree that the determination of the character of land, according to the purpose for which it is meant or set apart and can be used, is a matter which ought to be determined on the facts of each particular case. What is really required to be shown is the connection with an agricultural purpose and user and not the mere possibility of user of land, by some possible future owner or possessor, for an agricultural purpose. It is not the mere potentiality, which will only affect its valuation as part of "assets", but its actual condition and intended user which has to be seen for purposes of exemption from wealth-tax. One of the objects of the exemption seemed to be to encourage cultivation or actual utilisation of land for agricultural purposes. If there is neither anything in its condition, nor anything in evidence to indicate the intention of its owners or possessors, so as to connect it with an agricultural purpose, the land could not be "agricultural land" for the purposes of earning an exemption under the Act. Entries in revenue records are, however, good prima facie evidence. We do not think that all these considerations were kept in view by the taxing authorities in deciding the question of fact which was really for the assessing authorities to determine having regard to all the relevant evidence and the law laid down by this court. The High Court should have sent back the case to the assessing authorities for deciding the question of fact after stating the law correctly.15. We think that this is a fit case in which we should set aside the judgment of the Full Bench of the High Court had hold that the Tribunal should determine afresh, from a correct angle, the question of fact whether any of the lands under consideration were "agricultural" or not for the purposes of the Act before it.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]In the case before us, the question is a connected one. Here also the term "agricultural land" has not been defined. That, however, does not mean that the land to be considered can be divorced from its actual or natural or ordinary user. If all land, which is capable of being used for agriculture, could be intended to be excluded from "assets", practically every type of land, including that covered by buildings, would fall within that class. Hence, it seems to us to be impossible to adopt so wide a test as would obviously defeat the purpose of the exemption given. Apparently, agricultural land is excluded from the definition of "assets" as it was thought that parliament was not competent to impose taxes which will fall on agricultural land. What ever may be the reason for the exemption, we think that the exemption is connected with the user of land for a purpose which must be agricultural. It is an enactment to tax "wealth" which includes all that is ordinarily understood as "assets". The person claiming an exemption of any property of his from the scope of his asset must satisfy the conditions of the exemption.It is true that in Raja Benoy Kumar Sahas Roys case this court pointed out that meanings of words used in Acts of Parliament are not necessarily to be gathered from dictionaries which are not authorities on what Parliament must have meant. Nevertheless, it was also indicated there that where there is nothing better to rely upon, dictionaries may be used as an aid to resolve an ambiguity. The ordinary dictionary meaning cannot be discarded simply because it is given in a dictionary. To do that would be to destroy the literal rule of interpretation. This is a basic rule relying upon the ordinary dictionary meaning which, in the absence of some overriding or special reasons to justify a departure, must prevail. Moreover, it was held there that the dictionary meanings of the word "agricultural" were wider than what was meant by agricultural income as that term was used in the Income-tax Act. Even if we could give a wider connotation to the term "agricultural" than the one it carries with it in the Income-tax Act, we cannot dispense with credible evidence of at least appropriation or setting a part of the land for a purpose which could be regarded as agricultural and for which the land under consideration could be reasonably used without an alteration of its character. This, we think, is the minimal test of "agricultural land" which should be applied in suchthink that it is not correct to give as wide a meaning as possible to terms used in a statute simply because the statute does not define an expression. The correct rule is that we have to endeavour to find out the exact sense in which the words have been used in a particular context. We are entitled to look at the statute as a whole and give an interpretation in consonance with the purposes of the statute and what logically follows from the terms used. We are to avoid absurd results. If we were to give the widest possible connotation to the words "agricultural land", as the Full Bench of the Andhra Pradesh High Court seemed inclined to give to the term "agricultural land", we would reach the conclusion that practically, all land, even that covered by buildings, is "agricultural land" inasmuch as its potential or possible use could be agricultural. The object of the Wealth-tax Act is to tax surplus wealth. It is clear that all land is not excluded from the definition of assets. It is only "agricultural land" which could be exempted. Therefore, it is imperative to give reasonable limits to the scope of the "agricultural land", or, in other words, this exemption had to be necessarily given a more restricted meaning than the very wide ambit given to it by the Full Bench of the Andhra Pradesh High Court.The Full Bench itself saw the need for some kind of limitation to the application of "widest purpose" principle, if one may call it that. Therefore, evidently in an attempt to avoid the unreasonable conclusion to which too wide a definition of "agricultural land" would naturally lead to, the Full Bench, in the fourth conclusion recorded by it, held that, if some vacant land is actually built upon, it changes its physical characteristics and becomes unfit for immediate cultivation. It thus qualified its view that the widest possible meaning must be given to "land". Its final view was that only such land could cease to be agricultural land as had actually become unfit for immediate use for an agricultural purpose. This view seems to imply that one has to start with the presumption that all "land" as such is "agricultural land". If one were to start with such a presumption (although, we must, in fairness to the views actually expressed by the Full Bench, observe that it did not expressly say so), even desert land will have to be first presumed to be agricultural land. We feel certain that the Full Bench did not mean to carry the application of assumptions or principles, which seem to follow from its reasoning, so far asNos. 6, 7 and 8 are only negative in character. They merely indicated what could not be conclusive in deciding whether the land was agricultural. Conclusions Nos. 6 to 8, as stated above, would seem to be correct. But, in our opinion, they do not carry us far in formulating a test of what is agricultural land. Conclusion No. 5 seems to have been the real or positive test, based on entries in revenue records, actually adopted by the Full Bench for determining the nature of theshall be lawful for the Taluqdar, and in case a taluka is under settlement, for the Commissioner of Survey Settlement or Commissioner of Land Records after giving a hearing to the landholder to prohibit its appropriation for any particular purpose and record reasons therefor and to summarily evict the holder who may have appropriated the said land to prohibitedof the Andhra Pradesh Land Revenue Act seem to involve quasi-judicial proceedings, or at least, an enquiry into the purposes for which land to be assessed has been appropriated. The Full Bench of the Andhra Pradesh High Court has held these entries to be "strong prima facie evidence", and it practically decided the case on the basis of these entries. But the difficulty seems to us to be that the taxing authorities had given a categorical finding that the land under consideration had neither been used for an agricultural purpose nor was it ever intended to be so used. It may be that this finding was based on no evidence or was based on the circumstance that the land appeared to have been kept, as the environs of a huge palace, unused for any agricultural purpose. It may be that the past history of such lands could give rise to some guess work that no agricultural user was intended by the owners of the Begumpet Palace. But, is it possible to reach a categorical finding or conclusion on the basis of general notions, based on past history of the way in which such lands were treated by their aristocratic owners ? At any rate, there presumably was some, possibly quasi-judicial, enquiry at the time of classification of land as "agricultural" under the provisions of section 50 of the Andhra Pradesh Land Revenue Act. There must have been some evidence given for such a classification.Learned counsel for the assessee-respondents submitted that no evidence had been led on the question of intended user before the taxing authorities as the "prima facie evidence", provided by the entries in the revenue records, was considered enough. It has, however, to be remembered that such entries could raise only a rebuttable presumption. It could, therefore, be contended that some evidence should have been led before the taxing authorities of the purpose or intended user of the land under consideration before the presumption could be rebutted. If the "prima facie" evidence of the entries was enough for the assessee to discharge his burden to establish an exemption, as it seemed to be, evidence to rebut it should have been led on behalf of thethink that this aspect of the question was not examined by the Full Bench from a correct angle. Although it seems to have based its conclusion primarily on the "prima facie" evidence provided by the entries under section 50 of the Andhra Pradesh Land Revenue Act, it had also used other indicia which were really not very helpful. They had a bearing on potentialities for agricultural user. The Full Bench had, however, not recorded a finding that the conclusion reached by the taxing authorities, that the land was never even intended to be used for an agricultural purpose, rested on no evidence at all. It had not given its reasons for rejecting this finding of thealso think that the Full Bench was not correct in adopting the view expressed in Sarojini Devis case by the Madras High Court where it was held that it was enough to show that the land under consideration was capable of being used for agricultural purposes. This erroneous view also seems to us to have affected the conclusion of the Full Bench on what was essentially a question of fact. It had led the Full Bench into giving excessive weight to considerations which had a bearing only on potentialities of the land for use for agricultural purposes.For the reasons already given, we do not think that the term "agricultural land" had such a wide scope as the Full Bench appears to have given it for the purposes of the Act we have before us. We agree that the determination of the character of land, according to the purpose for which it is meant or set apart and can be used, is a matter which ought to be determined on the facts of each particular case. What is really required to be shown is the connection with an agricultural purpose and user and not the mere possibility of user of land, by some possible future owner or possessor, for an agricultural purpose. It is not the mere potentiality, which will only affect its valuation as part of "assets", but its actual condition and intended user which has to be seen for purposes of exemption from wealth-tax. One of the objects of the exemption seemed to be to encourage cultivation or actual utilisation of land for agricultural purposes. If there is neither anything in its condition, nor anything in evidence to indicate the intention of its owners or possessors, so as to connect it with an agricultural purpose, the land could not be "agricultural land" for the purposes of earning an exemption under the Act. Entries in revenue records are, however, good prima facie evidence. We do not think that all these considerations were kept in view by the taxing authorities in deciding the question of fact which was really for the assessing authorities to determine having regard to all the relevant evidence and the law laid down by this court. The High Court should have sent back the case to the assessing authorities for deciding the question of fact after stating the lawthink that this is a fit case in which we should set aside the judgment of the Full Bench of the High Court had hold that the Tribunal should determine afresh, from a correct angle, the question of fact whether any of the lands under consideration were "agricultural" or not for the purposes of the Act before it.