Judgment :- 1. In these three references made by the Kerala Agricultural Incometax Appellate Tribunal, under S.60 (1) of the Agricultural Incometax Act, 1950 the common question referred is the following: "Whether on the facts and in the circumstances of the case, the Tribunal is justified in holding that expenses like police expenses, litigation expenses incurred for conducting encroachment cases, assault and theft cases, industrial disputes, etc., and expenditure towards Batta, T. A. and wages to witnesses, are allowable deductions under S.5 of the Agricultural Incometax Act, 1950?" The assessee is the same in all the cases. It was deriving agricultural income from tea and rubber. It claimed deduction under S.5 of the Act in respect of various items like police expenses, litigation expenses, expenses by way of wages and T. A. to witnesses, expenses for sending curably to the Inspector of Plantations, and under other miscellaneous heads. The Assessing Officer disallowed their claims, and on appeal, the Deputy Commissioner concurred. The Appellate Tribunal took a different view and allowed the claims. The references have then been made at the instance of the Commissioner of Agricultural Income-tax 2. Police expenses were incurred for stationing police force in the assessee's estates to maintain law and order during strikes and other disturbances. Litigation expenses were incurred in connection with encroachment cases, assault cases and industrial disputes, and the claims represented advocate's fee, court expenses etc. Amounts were also spent towards wages and T. A. of the assessee's employees who were witnesses in courts in cases relating to theft of rubber and assault cases. Samples of the cumblies to be distributed among the workers under the Plantations Labour Act had to be approved by the Inspector of Plantations, and expenses had been incurred for sending these cumblies to the Inspector. These were generally the nature of the expenses in dispute; there were also some miscellaneous items of a similar nature. 3. The Appellate Tribunal held that these were permissible deductions under S.5 0) of the Act, as the amounts had been spent wholly and exclusively for the purpose of deriving the agricultural income In so holding, it relied on certain decisions rendered under the Indian Incometax Act, 1922 and expressed the view that S.5 0) of the Agricultural Incometax Act corresponds to S.0 (2) (xv) of the former. The revenue challenges this view, and the contention is that the scope of the two provisions is different 4. S.10 (2) (xv) of the Indian Incometax Act, 1922 reads: 10 Business. (1) (2) Such profits or gains shall be computed after making the following allowances, namely: (xv) any expenditure (not being an allowance of the nature described in any of the clauses (i) to(xiv) inclusive, and not being in the nature of capital expenditure or personal expenses of the assessee) laid out or expended wholly and exclusively for the purpose of such business, profession or vocation." S. 5 0) of the Agricultural Incometax Act reads. "5. Computation of agricultural income: The agricultural income of a person shall be computed after making the following deductions, namely: 0) any expenditure (not being in the nature of capital expenditure or personal expenses of the assessee) laid out or expended wholly and exclusively for the purpose of deriving the agricultural income;" The argument is that in the context of the word "deriving" used in the Kerala Act, the scope of the deductions in clause 0) of S.5 is narrower than the allowance referred to in clause (xv) of sub-section (2) of the Incometax Act. 5. The very same question was considered by a Division Bench of this Court in Commissioner of Agricultural Incometax v. Nilambur Rubber Co. Ltd. (1969) 71 I.T.R. 686 and it was observed: 'The learned counsel for the revenue submitted that the provisions of the two statutes are not the same in this respect. He submitted that under clause 0) of S.5 of the Agricultural Income-tax Act, the expenditure must be one laid out or expended "for the purpose of deriving the agricultural income", while under clause (xv) of S.10(2) of the Indian Income-tax Act, it is enough if it is laid out or expended "for the purpose of such business, profession or vocation". He submitted that the expression "the purpose of such business" has got a far wider range than the expression "for the purpose of deriving the agricultural income". In the former case, the expenditure need not have any relation to the profits or gains; but in the latter case it must relate to the deriving of the income. We do not agree with this contention Though there is difference in the words employed in the two statutory provisions, we think that their effect is the same. In the former case, the expenditure need not have any relation to the profits or gains; but in the latter case it must relate to the deriving of the income. We do not agree with this contention Though there is difference in the words employed in the two statutory provisions, we think that their effect is the same. It is not necessary that there must be income for claiming the allowance under clause 0) of S.5 of the Agricultural Incometax Act All that is required is that it should have been expended for the purpose of deriving the income, whether the adventure results in profits or gains. The same is the position under the Indian Income-tax Act. The purpose of a business is deriving profits and gains; and, in our opinion, an expenditure for the purpose of business is one for the purpose of deriving income therefrom." Faced with this clear pronouncement, counsel for the revenue made a courageous attempt to canvass its correctness by leaning heavily on the decision of the Judicial Committee of the Privy Council in Commissioner of Incometax v. Kamakhaya Narayan Singh (1948) 16 I.T.R. 325 where the meaning of the term "derived" was considered The question there was whether interest on arrears of rent payable in respect of land used for agriculture was agricultural income within the meaning of S.4(3) (viii) of the Indian Incometax Act, 1922. "Agricultural income" was defined in S.2 of the Incometax Act as "rent or revenue derived from land" used for agricultural purpose Their Lordships held that "derived" was not a terra of art and that its use in the definition demanded an enquiry into the genealogy of the product. But the enquiry should stop as soon as the effective source was discovered So approached, land was held to be in the second degree in the genealogical tree of interest In other words, the connection between "interest" and "land" was not sufficiently proximate, and the interest was not rent or revenue from land so as to constitute "agricultural income", as defined. The decision illustrates what would not constitute agricultural income; but is not of much assistance in deciding what should be the outgoings therefrom, under a statutory scheme essentially different. 6. The Supreme Court considered the scope of S.5 0) in the Travancore. Rubber and Tea Co. Ltd. v. Commissioner of Agricultural Incometax (1961) 411. The decision illustrates what would not constitute agricultural income; but is not of much assistance in deciding what should be the outgoings therefrom, under a statutory scheme essentially different. 6. The Supreme Court considered the scope of S.5 0) in the Travancore. Rubber and Tea Co. Ltd. v. Commissioner of Agricultural Incometax (1961) 411. T. R.751, a case which had gone up from this Court. The assessee's estate in that case contained mature yielding trees and also immature rubber plants, and the question was whether the expenses incurred for the maintenance and upkeep of the non-yielding trees constituted a permissible deduction. This Court had taken the view that S.50) permitted deduction only in respect of expenses incurred for deriving the income i.e. the income of the accounting year, and that expenses incurred in respect of the non-yielding plants were not such expenses. But the Supreme Court reversed the decision and held that the expenses on superintendence, weeding etc. of the whole estate should have been allowed. Expenses for superintendence and for up-keep of non-yielding plants are not expenses directly incurred for "deriving" income, if the word is narrowly construed as contended for by the revenue; and such a narrow construction was not favoured by the Supreme Court.. 7. It is unnecessary to refer to the many decisions cited on behalf of the assessee. What S 5 0) provides for is a deduction from the agricultural income in respect of expenditure laid out wholly and exclusively for the purpose of deriving the income. To confine this provision to cover only those expenses which are directly and immediately relatable to the derivation of income will be to import limitations which are not there, either in the language or in the context, and to hold that what is contemplated is only "agricultural expenses" considered as an antithesis of "agricultural income". It appears that S.50) of the Agricultural Incometax Act and S.10 (2) (xv) of the Indian Income Tax Act, 1922 represent conceptions which are kindred though distinct. No doubt there should be connection between the item of expenditure and the earning or ensuring of income; and the connection should not be remote, indefinite or fanciful Whether there is such connection in a given case will be a question of tact, once the proper approach is seen to have been made. No doubt there should be connection between the item of expenditure and the earning or ensuring of income; and the connection should not be remote, indefinite or fanciful Whether there is such connection in a given case will be a question of tact, once the proper approach is seen to have been made. The Tribunal has found, in the case, on hand that the expenses were laid out by the assessee for one or other of the following purposes: (i) obstructing encroachment into the lands used for agriculture; (ii) protecting the plants and trees from destruction; (iii) preventing theft and pilferage of the produce; (iv) resisting exorbitant demands of labour and maintaining discipline; (v) complying with the requirements of law relating to welfare of the labour force. On these findings, the conclusion seems to be possible that the expenditure was wholly and exclusively laid out for preserving the land and trees and for maintaining, if not augmenting, the income therefrom. 8. In the result, we answer the question in the affirmative, i.e., in favour of the assessee and against the revenue. The parties will bear their own costs. 9. A copy of this judgment under the seal of this Court and the signature of the Registrar will be forwarded to the Tribunal as required by S.60(6) of the Act.