HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
S. R. Y. Sivaram Prasad Bahadur v. Commissioner of Income-tax, Hyderabad
Civil Appeals Nos. 1309-1312 of 1968 and connected appeals
[1972] 1 SCR 320 ·
Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948: sections 3, 39, 41, 44, 50, 54A and 54B · Indian Income-tax Act, 1922: section 66(1)
Sources & disclosures includedDownload original judgment / order
2-judge bench; unanimous judgment delivered by K. S. Hegde, J. · K. S. Hegde, J. · A. N. Grover, J.
Assessment years: 1953-54, 1954-55, 1956-57, 1958-59
01 · Facts of the case
Former estate holders received interim payments under section 50(2) after their estates vested in the State, while final compensation could take years to determine. Tax authorities treated the recurring, income-measured payments as revenue; the Tribunal treated them as capital compensation (SCR pp.320-325; PDF pp.1-6).
Source: Primary judgment: facts
02 · Discussion by the Hon’ble Court
The Act created distinct advance, interim, total and additional payments and terminated the landholders' rights on notification. The interim amounts compensated recurring loss from taking income-producing assets, not use of a due money debt; measurement by lost agricultural income did not determine character. Final compensation was not yet due and section 50(8) did not make interim payments revenue (SCR pp.323-333; PDF pp.4-14).
Source: Primary judgment: discussion
03 · Judicial decision
The Court held the interim payments capital, allowed the appeals and connected writs, prohibited their inclusion and awarded costs with one Supreme Court hearing fee (SCR p.333; PDF p.14).
Source: Primary judgment: decision
04 · Outcome / in whose favour
In favour of the assessees under this statutory scheme (SCR pp.332-333; PDF pp.13-14).
Source: Primary judgment: outcome
05 · AKHB REVIEW POINT
AKHB analysis: characterise a payment by the legal source and right it replaces, not its recurrence or income-based measure. Distinguish compensation for taking an asset from interest on a determined debt or maintenance during continued administration (based on SCR pp.330-333; PDF pp.11-14).
Source: Primary judgment: review point
Source & verification
Download original judgment / order · Open cited source rendition
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Statutory scope
The decision applies repealed income-tax law and the historical Madras estate-abolition scheme; no current compensation rule is represented.
Later treatment
Source checked 2026-10-11. Later judicial treatment and current statutory applicability have not been comprehensively checked; no current-law or citator clearance is represented.
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