Judgment

HIDAYATULLAH, J. : These two appeals by special leave arise from two petitions under Art. 226 of the Constitution in the High Court of Kerala questioning the assessment to Agricultural Income-tax of Bhavani Tea Produce Co. Ltd. (respondent) under the Madras Plantations Agricultural Income-tax Act, 1955 (as extended to Kerala State) for the assessment years 1955-56 and 1956-57, respectively. The High Court decided that certain receipts were not taxable in those assessment years and the State of Kerala is the appellant before us. The assessment year in each case ended on March 31, of the year and tax was leviable on the results of the previous year. For the first of the two assessment years, corresponding to the previous year ended on March 31, 1955 the net agricultural income was assessed at Rs. 1,32,198 and a tax of Rs. 45,443-1-0 was demanded by the Department and in the succeeding assessment year, corresponding to the previous year ended on March 31, 1956, the amounts of net agricultural income and the tax were respectively Rs. 1,24,339 and Rs. 42,810-5-0. The assessee Company claimed that Rs. 97,090 in the first year and Rs. 10,095 in the second year were not taxable although received by the company from the Coffee Board during the relevant accounting years. The Company contended that these payments were in respect of coffee delivered by the Company to the Coffee Board under S. 25 of the Coffee Market Expansion Act, 1942, in the years 1952-53 and 1953-54, that is to say, prior to April 1, 1954 when the Madras Plantations Agricultural Income-tax Act came into force and were not assessable, as the accounts were maintained on the mercantile system and the amounts were shown in 1952-53 and 1953-54. This plea was not accepted by the Agricultural Income-tax Officer, Coimbatore. His assessment orders are, dated May 18, 1956 and July 15, 1957, respectively. The Company appealed, but the Appellate Assistant Commissioner by orders passed on December 19,1958 dismissed the appeals. The Company appealed further. By a common order, dated January 25, 1960 the Agricultural Income-tax Appellate Tribunal dismissed the appeal in respect of the assessment year 1955-56. In the other appeal the conclusion was the same but the case had to be remanded to ascertain some matters not connected with the present controversy. In both the cases the Department had held that the income was derived in the relevant previous year and this opinion was upheld previous year and this opinion was upheld by the Appellate Tribunal. The Appellant Tribunal observed that.

"amounts actually received in the previous year as the price of coffee from the plantation should be regarded as income derived from the plantation in that year irrespective of the year to which the crop belongs."

The Company did not apply for revision under S. 54 of the Agricultural Income-tax Act, but instead filed petitions under Art, 226 of the Constitution against Agricultural Income-tax Officer, Coimbatore. Appellate Assistant Commissioner of Agricultural Income-tax, Kozhikode and Agricultural Income-tax Appellate Tribunal, Trivandrum. The petitions were heard by Mr. Justice Vaidialingam who accepted the contention of the assessee company and cancelling the assessment orders impugned before him directed the Agricultural Income-tax Officer to make a reassessment of the total income excluding the sums of Rs. 97,090 in the first year and Rs. 10,095 in the second year. The judgment was pronounced on August 18, 1961. The State of Kerala and the Agricultural Income-tax Officer appealed under the Letters Patent. The appeal was summarily dismissed on January 9, 1962. It is from this judgement that the present appeals have been filed.

2. The only question is whether the two amounts were rightly excluded from the assessable agricultural income for the two assessment years. The answer to this question depends on whether under the scheme of the Madras Plantations Agricultural Income-tax Act read with