Scottish Court of Session Decisions

The Finance Act 1896 (59 and 60 Vict. cap. 28) enacts—Section 26 (1)—“Where this or any other Act enacts that income tax shall be charged in any year at any rate, there shall be charged, levied, and paid during that year in respect of all property, profits, and gains respectively described or comprised in the several Schedules A, B, C, D, and E in the Income Tax Act 1853, the tax at that rate … for every 20s. of one-third of the annual value of lands, tenements, hereditaments, and heritages chargeable under Schedule B in the said Act in respect of the occupation thereof.”

The Finance Act 1918 (8 and 9 Geo. V, cap. 15) enacts—Section 21—“Sections 26 and 27 of the Finance Act 1896 (which relate respectively to the application of the Income Tax Acts, and to annual value for the purpose of exemption from or abatement of income tax under Schedule B) shall, as respects income tax under Schedule B, have effect as if for the references to one-third of the annual value there were substituted references to an amount equal to twice the annual value: Provided that where it is proved to the satisfaction of the Income Tax Commissioners concerned that any person occupying any lands and assessed to income tax in respect thereof under Schedule B is not occupying those lands for the purposes of husbandry only, or mainly for those purposes, the above provisions shall … apply in relation to those lands as if for the reference to an amount equal to twice the annual value there were substituted a reference to an amount equal to the annual value.”

Duncan Keir, farmer, Oldtown of Carnaveron, Alford, Aberdeenshire, appellant, being dissatisfied with a decision of the Commissioners for the General Purposes of the Income Tax Acts for the County of Aberdeen assessing him to income tax upon twice the annual value of certain hill grazings occupied by him, took a Case for appeal in which Thomas Gillespie, surveyor of taxes, Aberdeen, was respondent.

The Case set forth—…“The appellant appealed against the following] assessments made [upon him] for the year ending 5th April 1919, as occupier, under Schedule B of the Acts 16 and 17 Vict. cap. 34, and 8 and 9 Geo. V, cap. 15, section 21, on an amount equal to twice the annual value, in respect of the following subjects in the county of Aberdeen, of which the appellant is entered in the valuation roll for the year 1918–19 as tenant and occupier, namely:—

No. on Roll.	Parish of Strathdon.	Yearly Rent or Value.
209	Croft and house, Conryside,	£9	1	1
343	Farm and house, Dunanfew and Dunfiel,	31	19	9
355	Grazings, Faevait and Delnadampli	Note.—From this rent is deducted £8, the annual value of two houses, Nos. 356 and 357 on roll, of which appellant is tenant but not occupier, thus leaving a net value of £119, 3s. 7d. on which appellant is assessed.	127	3	7
427	Land, Skellater, Mains of,	Parish of Glenmukk.	28	2	6
311	House and Grazings, Glenfenzie	60	0	0

The following facts were admited (1) The subjects, although variously described in the entries in the valuation roll, were in each case Occupied by the appellant for the grazing of sheep. (2) The income arising from the occupation of said subjects is chargeable under Schedule B of the Income Tax Act 1853. (3) Appellant claimed that he should beassessed on theannual value of the above entries in the valuation roll in place of twice the annual value as contained in the notices of assessment. … ( b) No proof was led by the appellant.”

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The contentions of the appellant included “( a) That the appellant who occupied as grazings lands in respect of which the assessments appealed against were levied, was not occupying those lands for the purposes of husbandry only or mainly for those purposes. (6) That the true meaning of the words ‘occupying those lands for the purposes of husbandry only or mainly for those purposes’ was occupation for the purpose of tillage or cultivation, and that as the appellant did not till or cultivate the soil of those holdings, which consist mainly of hill grazings, therefore he did not occupy the lands for the purposes of husbandsy.”

The contentions of the respondent were—“( a) That the meaning of ‘husbandry’ was not restricted to tillage and agricultural operations only, but extended to all farming operations, and included the rearing of sheep and the grazing of lands by sheep or cattle. ( b) That the Income Tax Acts from 1842 downwards made no distinction between farmers generally and those occupying lands for the purposes of husbandry, and that especially the Income Tax Act of 1851, section 3, and the Income Tax Act of 1853, section 46, both showed by the marginal notes that persons occupying lands for the purposes of husbandry were considered as tenant farmers. That persons occupying lands as graziers were considered as farmers with respect to such lands, and could not accordingly be held as ‘not occupying lands for the purposes of ‘husbandry only or mainly for those purposes,’ and ( c) That the assessments appealed against were correctly made on an amount equal to twice the annual value, and that the appellant was not entitled to have an amount equal to the annual value substituted for twice the annual value, as he was occupying those lands for the purposes of husbandry only or mainly for those purposes.”

The Commissioners being of opinion that the word “husbandry” included the use of lands for the purpose of grazing, and that therefore the appellant had not proved that he was not occupying those lands for the purpose of husbandry only, or mainly for those purposes, dismissed his appeal.

The following authorities were referred to:—The Income Tax Act 1842 (5 and 6 Vict. cap. 35), section 63, and Schedule B; the Income Tax Act 1851 (14 and 15 Vict. cap. 12), section 3; the Income Tax Act 1853 (16 and 17 Vict. cap. 34), section 2, Schedule B, and section 46; the Inland Revenue Act 1880 (43 and 44 Vict. cap. 20), section 52; the Customs and Inland Revenue Act 1887 (50 and 51 Vict. cap. 15), section 18; the Finance Act 1896 (59 and 60 Vict. cap. 28), section 26: the Finance Act 1918 (8 and 9 Geo. V, cap. 15), section 21; Inland Revenue v. William Ransom & Sons, [1918] 2 K.B. 709; Meux v. Cobley, [1892] 2 Ch 253; in re Cavan Co-operative Society, [1917] 2 I.R. 594, per Madden, J., at p. 605; Chambers' English Dictionary, 1914; the New English Dictionary; the Century Dictionary, 1889; and Stormonth's English Dictionary, voce “husbandry” and “husbandman”; Tusser's Five Hundred Pointes of Good Husbandrie.

At advising—