P L D 1965 W (PLP)

I have heard the parties at a length regarding the differing interpretations of the Commissioner and the Collector of section 9 (2) of Act and of the explanation appended to section 2 (3). Section 9 (2) of the Act of 1949 and section 2 (3) of the Act of 1953 are reproduced below so as to help in appreciating the correct legal position Section 9 (2) of the Act 1949. "Land Revenue" means the land revenue assessed on any land under the Punjab Land Revenue Act, 1887 and where any land is not assessed the land revenue assessed on similar land in the same estate or assessment circle." Section 2 (3) of Act 1953 which was passed in Urdu runs as:‑ A translation of the above would be:‑‑ The tax will be assessed and levied on the basis of the total land revenue demand which may have been payable by the owner of land in the previous year subject to the proviso that Government may by a notification in the official Gazette exempt any land owner or class of land‑owners wholly or partly from the tax. Explanation :‑Land revenue which in spite of having been assessed has been remitted or the recovery of which has been suspended will not be considered as payable during the period of remission or suspension. It has been argued that as the land was muafi inam, it had never been assessed to land revenue at all and was not therefore liable to the tax. Further even if two interpretations of the provisions of the Act are possible, as it is fiscal statute the rule is that the interpretation in favour of the subject is to be accepted. In this connection attention is also invited to the views expressed by Mr. Akhtar Hussain in R. O. R. No, 1555 of 1952‑53 in case Nawab Muzaffar Ali Qazilbash v. The Crown. In that case which fell under the Punjab Agricultural Income‑tax' Act a similar question arose. The Punjab Act has similar explanation appended to section 3 (2) of the Act of 1951. This explanation reads as follows:‑ "Land Revenue" which though assessed has been remitted, or the payment of which has been suspended, shall, during the period of remission or suspension, not be treated as payable." The land in that case was held as jagir and its land revenue had been redeemed. Mr. Akhtar Hussain held that the explanation refers to remissions and suspensions on account of failure of crops due to some clamity and does not refer to non‑assessment of land revenue altogether. In the Punjab Act the basis of assessment of, the tax is the liability to payment of land revenue whether land revenue is in fact assessed or not. In the Bahawalpur Act too the word used is "wajibulada", i.e. payable. So there seems hardly any difference. Agreeing with my distinguished predecessor I am inclined to the view that agricultural income‑tax was rightly levied against the respondent on the muafi land held by him. The matter however, is of considerable importance and the Collector and the Commissioner have come to two opposite conclusions. There may be some other cases of the old Bahawalpur State of this nature. I would accordingly refer the case for adjudication of the Full Board as the interpretations of the provisions of the law require to be authoritatively settled to serve as guidance in future in all similar cases. Parties should be informed. This order will dispose of two Appeals Nos. 78. and 79 of 1957‑58 together as the point involved in both of them is the same. The facts of the case have been given in detail in my order dated 29th April, 1963 and it may be read as a part of the final order. The main question for determination is whether in view of section 2 (3) of the Bahawalpur State Agricultural Income‑tax (Amendment) Act, 1953, this tax can be levied on the `muafi inam' lands held by the respondent. The Collector and the Commis sioner, had come to two opposite conclusions and as it was an important and new point a reference was made to the Full Board who, after carefully going into the matter, have held that "the `muafi inam' lands are subject to assessment of agricultural income tax. In accordance with this finding with which I agreed, I would, set aside the order passed by the learned Commissioner on 7‑3‑1958, accept the two appeals and restore that of the Collector dated 12‑6‑56 assessing agricultural income‑tax on the `muafi inam' lands held by the respondent. S. Q. Appeal accepted.