V. Venugopala Ravi Varma Rajah Vs.
Union of India & ANR  INSC 58 (26 February 1969)
26/02/1969 SHAH, J.C.
CITATION: 1969 AIR 1094 1969 SCR (3) 827 1969
SCC (1) 681
CITATOR INFO :
RF 1970 SC 508 (13) R 1972 SC 845 (15) RF
1973 SC 623 (13) R 1974 SC 849 (9) R 1981 SC1269 (4,8,9)
Expenditure Tax Act (29 of 1957), s.
3(1)-Applicable to Hindu families governed by Marumakkattayam law but not to
Mappilla families governed by the Marumakkattayam law-If violative of Art. 14
Constitution of India, 1950.
The members of a Hindu undivided family
governed by the Marumakkattayam law, while remaining joint, had entered into an
agreement for separate 'enjoyment of certain properties of the family by
different members as permitted by their customary law. For the assessment year
1958-59 its karta, in the status of a Hindu undivided family, filed a return
under the Expenditure-tax Act, 1957, of the expenditure incurred by him in
respect of the property under his 'personal control and direct enjoyment'. The
Expendituretax Officer added the expenditure incurred by the other members of
the family in respect of properties set apart for their use and enjoyment as
the expenditure of the Hindu undivided family under s. 3(1).
On the question, whether s. 3 is violative of
Art. 14 because, a Hindu undivided family governed by the Marumakkattayam law
as to pay the tax at a higher rate by reason of the unit of taxation under the
section being the Hindu undivided family there is an amalgamation of the expenditure
of all the members of the family, whereas, a Mappilla family may pay tax at a
lower rate since the members of a Mappilla undivided family governed by the
Marumakkattayam law are liable to be taxed as 'individuals' under the section,
HELD:The equal protection clause of the
Constitution allows a large play to legislative discretion in the matter of
classification. The power to classify may be exercised so as to adjust the
system of taxation in all proper and reasonable ways : the Legislature may
select persons, properties, transactions and objects, and apply' different
methods and even rates of tax, if the Legislature does so reasonably and if the
classification is rational. A taxing statute may contravene Art. 14 if it seeks
to impose on the same class of property, persons, transactions or occupations
similarly situate, an incidence of taxation which leads to obvious inequality,
but, a taxing statute is not exposed to attack on the ground of discrimination
merely because different rates of taxation are prescribed for different
categories of persons, transactions, occupations or objects.
The courts will not strike down an Act as
denying the equal protection of laws Merely because other objects could have
been, but are not, taxed by the Legislature. [832 H; 833 AF] Though the law
applicable to Hindu undivided families governed by the Marumakkattayam law and
to the Mappilla tarwad in North Malabar has the same characteristics in two
respects, namely, (a) tracing descent through females; and (b) community of
interest and unity of possession in respect of the family property, the laws
applicable to them in other respects differ widely. Initially a common system
of law relating to family property of the tarwad was applicable to Hindus and
Mappillas governed 828 by the Marumakkattayam law, but since the enactment of
the Madras Marumakkattayam Act (22 of 1933) and other enactments governing
Hindus, and the Mappilla Marumakkattayam Act (17 of 1939) governing the
Mappillas, there are few points of similarity in property matters in the
tarwads. The application of the Islamic laws of marriage and inheritance to the
Mappillas has led to greater cleavage. The community of Mappillas governed by
Marumakkattayam law is a small community, restricted only to the Northern area
of Malabar district and is dwindling because of the impact of the Muslim law of
inheritance applicable to sham obtained on partition. Parliament has been
accustomed to treating a Hindu undivided family as a unit of taxation and to
enacting tax laws making a distinction between a Hindu undivided family
consisting of Hindus and undivided families of Mappillas. The long course of
legislative history in matters of taxing income, wealth, gifts, capital
gains'and business profits indicates that the Legislature regarded undivided
Hindu families as a class to which the legislation may appropriately be
applied. Even though the basic scheme of a Hindu undivided family governed by
the Mitakshara law is different from that of a family governed by the
Marumakkattayam law, a Hindu undivided family governed by the Marumakkattayam
law fails within the expression 'Hindu undivided family. Therefore, Parliament,
by making the Act applicable to Hindu families and not to Mappilla families
governed by the Marumakkattayam law, has not attempted any obvious inequality
or made any discrimination violative of Art. 14. [832 B-C, G-H; 834 E-G; 835
A-GI Raja Jagannath Baksh Singh v. State of U.P.,  1 S.C.R.
250, U.S. law referred to.
CIVIL APPELLATE JURISDICTION Civil Appeals
Nos. 2436 and 2437 of 1966.
Appeals by special leave from the judgment
and order dated November 5, 1965 of the Kerala High Court in Writ Appeals Nos. 39
and 44 of 1964.
M. C. Chagla, C. K. Vishwa Nath Aiyar and R.
Gopalakrishnan, for the appellant (in both the appeals).
D. Narsaraju, T. A. Ramachandran and B. D.
Sharma, for the respondents (in both the appeals).
The Judgment of the Court was delivered by
Shah, J. Rajah Padmanabha Ravi Varma was the karta of a Hindu undivided family
governed by the Marumakkattayam law.
On his death in 1961 the appellant his
brother-became the karta of the family. In 1909 the members of the family,
while remaining joint, had entered into 'an arrangement for separate enjoyment
of certain properties of the family by different members. For the assessment
year 1958-59 Rajah Padmanabha filed, in the status of a Hindu undivided family,
a return under the Expenditure-tax Act of the taxable expenditure incurred by
him in respect of the property under his "personal control and direct
enjoyment". The Expenditure-tax Officer added thereto 8 29 the expenditure
incurred by the other members of the family in respect of properties set apart
for their use and enjoyment. The Expenditure-tax Officer also served 'a notice
of assessment under s. 15(2) calling for a return of expenditure by the Hindu
undivided family for the assessment year 1959-60.
The appellant then moved petitions before the
High Court of Kerala under Art. 226 of the Constitution for writs quashing the
assessment and the notice of demand for the year 1958-59 and the notice calling
for a return for the assessment year 1959-60 contending, inter alia, that he
was not liable to be assessed to tax on expenditure incurred in respect of
property not "under the, High Court of Kerala upheld the contention. In
appeal a Division Bench of, the High Court set aside the order of the single
The appellant contends that the law which
enables the Expenditure-tax Officer to assess tax on the expenditure of all
members of the Hindu undivided family governed by the Marumakkattayam law,
discriminates, on the ground of religion, between the Hindu undivided family
and a Mappilla undivided family governed by the Marumakkattayam law resident in
Section 3 of the Expenditure-tax Act 29 of
1957 is the charging section : insofar 'as it is relevant it reads "(1)
Subject to the other provisions contained in this Act, there shall be charged
for every financial year, commencing on and from the first day of April, 1958,
a tax (hereinafter referred to as expenditure tax) at the rate or rates
specified in the Schedule in respect-of the expenditure incurred by any
individual or Hindu undivided family in the previous year Provided that Under
the charging section tax is imposed on individuals and Hindu undivided
families. An undivided family which consists of Hindus alone may be treated as
a unit of assessment: an undivided family whose members are not Hindus will be
assessed to tax as an "individual". Counsel for the appellant
contends' that whereas a Hindu family governed by the Marumakkattayam law is
assessed to expenditure-tax on the total expenditure incurred by all the
members of the undivided family, because the unit of taxation under s. 3 is the
Hindu undivided family, a Mappilla undivided family governed by the
Marumakkattayam law in 830 North Malabar is liable to be assessed to tax as an
"individual", and on that account at a lower rate.
Marumakkattayam law applied originally by
usage to a section of the Hindus inhabiting the South-Westem coastal region in
India. Some centuries ago a section of the Hindu inhabitants of North Malabar
were converted en masse to Islam, but they still continued to remain governed
by the Marumakkattayam law especially in matters of property relations among
members of the family. The law administered by the Courts to these communities
is, subject to express statutory provisions, a body of customs and usages which
have received judicial recognition.
The Mitakshara law of joint family is founded
upon agnatic relationship : the undivided family is characterised by community
of interest and unity of possession among persons descended from a common
ancestor in the male line. The principal incident of Marumakkattayam law is
that it is matriarchate : members of the family constituting a Marumakkattayam
tarwad are descended through a common ancestress in the female line with equal
rights in the property of the family. Under the customary Marumakkattayam law
no partition of the family estate may be made, but items of the family property
may by agreement be separately enjoyed by the members. On death of the interest
of a member devolved by survivorship. Management of the family propeerty
remained in the hands of the eldest male member, and in the absense of a male
member a female member. A tarwad may consist of two or more branches known as
thavazhies, each tavazhi or branch consisting of one of the female members of
the tarwad and her children and all her descendants in the female line. Every
tarwad consistedof a mother 'and her children-male and female-living in
commensality, with joint rights in property.
The District of Malabar formed part of the
State of Madras till October 31, 1956. The customary Marumakkattayam law
applicable to Malabar was modified in certainrespects from time to time by the
Madras Legislature e.g. the Malabar Marriage Act 4 of 1896, the Malabar Wills
Act 5 of 1898.
But the law relating to property relations
between the members of the tarwad remained in its customary form till the
fourth decade of this century. Under the customary law partition of the
property of the family could not be claimed by an individual member or even by
a thavazhi. It was so laid down by a course of judicial decisions' for over 75
years, and this rule was accepted as settled law till the Madras Legislature.
enacted the Madras Marumakkattayam Act, 22 of 1933 and the Mappilla
Marumakkattayam Act 17 of 1939, the former applying to Hindus and the latter to
Mappillas who are Muslims. There were however significant difference between
the two Acts. Under Act 22 of 1933 only 831 a tarwad could claim partition (s.
38) (by the Madras Marumakkattayam (Amendment) Act 26 of 1958 enacted by the
Kerala Legislature the right to claim partition was also granted to individual
members); property obtained by partition was held with incidents of tarwad
38(2)]; and the Karnavan was not require&
to maintain an inventory of the property, but had to maintain a true and
correct account of the income and expenditure of the tarwad.
By the Madras Act 17 of 1939 any member of a
Mappilla tarwad could claim partition' (ss. 13 & 14); succession to
property obtained by partition was governed by Istamic law (s. 18);
the Karnavan was required to maintain an
inventory of family property (s. 3); any member of the family could apply to
the Court for an order directing the Karnavan to give inspection of accounts or
inventory [s. 5(2)] surplus income had to be invested by the Karnavan (s. 7);
and the Karnavan could be removed by a suit (s. 11) These and other statutory
Modifications were applicable only to the Malabar area which was originally
part of the State of Madras and not to the State of Travancore-Cochin as it
existed before the States Reorganization Act, 1956. There were several
legislative measures in the States of Travancore and Cochin before those States
merged with the Indian Union, and in the State of Travancore-Cochin after
merger and in the State of Kerala, making changes in the customary
Marumakkattayam law: these were the Cochin Makkathayam Thiyya Act 17 of 1115
(M.E.); Cochin Marumakkattayam Act 13 of 1095 (M.E.). Cochin Nair Act 13 of
1095 (M.E.) and Act 29 of 1113 (M.E.); Cochin Paliam Tarwad Act 8 of 1097
(M.F); Cochin Thiyya Act 8 of 1107 (M.E.);
Travancore Nanjinad Vellala Regulation 6 of 1101
Travancore Nayar Regulation 1 of 1088 (M.E.)
and 11 of 1100 (M.E.) Travancore Wills Act 6 of 1074 (M.E.). It is sufficient
to observe that by these statutes significant changes were made in the
customary laws governing the family and property relations between the members
governed by the Marumakkattayam law.
The Hindu Succession Act 30 of 1956 also made
inroads upon the customary law.' Section 3(h) defined the expression
"Marumakkattayam law", and by s. 7 it was provided that it 'a Hindu
to whom the Marumakkattayam or Nainbudri law would have applied, if the Hindu
Succession Act had not been passed, dies, his or her interest in the property
of a tarwad, tavazhi or illom shall devolve by testamentary or intestate
succession, not according to the Marumakkattayam law or the Nambudri law, but
under the Hindu Succession Act.
By s. 17 of the Act ss.8, 10, 15 and 23 apply
to persons governed by the Marumakkattayam law subject to certain
832 The Hindu Adoptions and Maintenance Act
78 of 1956 the Hindu Marriage Act 23 of 1955 also apply to Hindus governed by
the Marumakkattayam law and modify the law relating to family relations.
Initially a common system of law relating to
family property of the tarwad was applicable to Hindus and Mapillas governed by
the Marumakkattayam law. Since the enactment of Madras Act 22 of 1933, and the
other Acts governing the Hindus, and Act 17 of 1939 governing the Mappillas,
points of similarity even in property relations in the tarwads have
considerably narrowed. Application of the Islamic laws of marriage and
inheritance to the Mappillas led to greater cleavage. If a member of a Mappilla
Marumakkattayam family married a person not governed by the Marumakkattayam
law, property of the person governed by Marumakkattayam law apparently devolved
according to that system of law, whereas the property of the person governed by
the Islamic law devolved according to Islamic rules of succession. The result
was that whereas the interest of a, Mappilla governed by the Marumakkatayam law
devolved by survivorship, his separate property descended by inheritance in
accordance with the Islamic law.
Hindus governed by the Marumakkattayam law,
since the enactment of the Hindu Succession Act remained members of the
undivided family, but on death the interest devolved by the rules prescribed by
the Hindu Succession Act.
In a Hindu tarwad governed by the
Marumakkattayam law the descent is matriarch-ate and all members male and
female have equal shares in the property of the tarwad. Though not a family
governed by the Mitakshara law, it is still a Hindu undivided family within the
meaning of the Expenditure-tax Act. The property relations between members of a
Mappilla Marumakkattayam tarwad governed by the matriarchate with equal shares
for males and females were in certain respects, already stated, different from
the relations between members of a Hindu joint family governed by the
The community of Mappillas governed by the
Marumakkattayam law is, compared to the Hindus, a small community restricted
only to the northern area of the Malabar District. it is again a dwindling community
because of the impact of the law of inheritance applicable to share obtained on
partition. it is in the light of these special characteristics that-the plea of
discrimination must be considered.
Equal protection clause of the Constitution
does not enjoin equal protection of the laws as abstract propositions. Laws
being the expression of legislative will intended to solve specific 8 33
problems or to achieve definite objectives by specific remedies, absolute,
equality or uniformity of treatment is impossible of achievement. Again tax
laws are aimed at dealing with complex problems of infinite variety
necessitating adjustment of several disparate elements. The Courts accordingly
admit, subject to adherence to the fundamental principles of the doctrine of
equality, a larger play to legislative discretion in the matter of Claification.
The power to classify may be exercised so as to adjust the system of taxation
in all proper and reasonable ways the Legislature may select persons,
properties, transactions :and objects, and apply different methods and even
rates of tax, if the ,Legislature does so reasonably.
Protection of the equality clause does not
predicate a mathematically precise or logically complete or symmetrical classification:
it is not a condition of the guarantee of equal protection that all
transactions, properties, objects or persons of the same genus must be affected
by it or at all. If the classification is rational, the Legislature is free to
choose objects of taxation, impose different rates, exempt classes of property
from taxation, subject different classes of property to tax in different ways
and adopt different modes of assessment. A taxing statute may contravene Art.
14 of the Constitution if it seeks to impose on the same class of property,
persons, transactions or occupations similarly situate, incidence of taxation,
which leads to obvious inequality. A taxing statute is not, therefore, exposed
to attack on the ground of discrimination merely because different rates of
taxation are prescribed for different categories of persons, transactions,
occupations or objects.
It is for the Legislature to determine the
objects on which tax shall be levied, and the rates thereof. The Courts will
not strike down an Act as denying the equal protection of laws merely because
other objects could have been, but are not, taxed by the Legislature : Raja
Jagannath Baksh Singh v. State of Uttar Pradesh and Another(1). The same rule
has been accepted by the Courts in America.
Wills in his Constitutional Law of the United
States has stated at p. 587 A state does not have to tax everything in order to
tax something. It is allowed to pick and choose districts, objects, persons,
methods, and even. rates for taxation if it does so reasonably." As stated
in Weaver's Constitutional Law Art. 275 at p. 405 Me Fourteenth Amendment was
not designed to prevent a state from establishing a system of taxation or from
effecting a change in its system in all proper, (1) (1963] 1 S.C.R. 220.
834 -and reasonable ways, nor to require the
states to adopt an ironclad rule of equality to prevent the classification of
property for purposes of taxation or the imposition of different rates upon
different classes." Weaver again says at p. 397 "Class legislation is
that which makes an improper discrimination by conferring Particular privileges
upon a class of persons, arbitrarily selected from a large number of persons,
all of whom stand in the same relation to the privilege granted and between
whom and the persons not so favoured no reasonable distinction ,or substantial
difference can be found justifying the inclusion of one and the exclusion of
the other from such privilege...... A classification must not be arbitrary
artificial or evasive and there must be a reason-able, natural and substantial
distinction in the nature of the class or classes upon which the law operates.
In respect to such distinction, a legislative body has a wide discretion and an
Act will not be held invalid unless the, classification is clearly unreasonable
and arbitrary." It is unnecessary to multiply citations.
The Parliament has declared for the purpose
of the Expenditure-tax Act an undivided family of Hindus as a unit of taxation
and imposed tax at the rates prescribed. To fall within the description the
unit must be an undivided family of Hindus. Within the expression "Hindu
undivided family" will fall an undivided family of Hindus governed by the
Marumakkattayam law. Even though the basic scheme of a Hindu undivided family
governed by the Mitakshara law and the Marumakkattayam law is different in two
important respects, viz. the descent is through females and children both males
and females have equal rights to pro-perty-these families are still Hindu
undivided families. The law applicable to Hindu undivided family governed by
the Marumakkattayam law, and to the Mappilla. tarwad in North Malabar has the
same characteristics in two principal respects(a) descent is traced through
females; and , (b) there is community of interest and unity of possession in respect
of the family property. But the laws applicable to those families in other
respects widely differ.
The Mappilla families governed by the
Marumakkattayam law reside in a small part of the country and form numerically
a small community. The Parliament has again been accustomed 8 35 in enacting
tax laws to make a 'distinction between a Hindu Undivided Family consisting of
Hindus and undivided families of Mappillas. By the taxing Acts the Parliament
could have treated Mappilla tarwads as units of taxation. But the mere fact
that the law could, have been extended to another class of persons who have
certain characteristics similar to a section of the Hindus but have not been so
included is not a ground for striking down the law. In treating a Hindu Undivided
Family as a unit of taxation under the Expenditure-tax Act and not a Non-Hindu
Undivided Family the Parliament has not attempted an "obvious
Under the taxing Acts the scheme of treating
a Hindu Undivided Family has been adopted for a long time, e.g., the Indian
income-tax Act IX of 1869, Indian Income-tax Act IX of 1870, Indian Income-tax
Act XII of 1871, Act VIII of 1872, Act 11 of 1886, Act VII of 1918, Act XI of
1922, Act 43 of 1961 have treated a Hindu Undivided Family as a distinct
taxable entity. Similarly under the Wealth-tax Act 27 of 1957 and the Gift-tax
Act 18 of 1958, the Hindu Undivided Family is made a unit of taxation. Under
the Business Profits Tax Act 21 of 1947 and the Excess Profits Tax Act, 1940
also the Hindu Undivided Family was made a unit of taxation. For the purposes
of these Acts Mappilla tarwads governed by the Marumakkattayam law have been
regarded as individuals.
This long course of legislative history in
matters of taxing income, wealth, gifts, capital gains and business profits
clearly indicates that the legislature regarded undivided families of Hindus as
a class to which the legislation may appropriately be applied. An intention to
effectively administer the taxing Acts and not to discriminate on the ground of
religion may be attributed to the Legislature.
The Parliament in the present case having
made the Expenditure-tax Act applicable to Hindus governed by the law of the
joint family, but not including Mappilla families who are governed by the
Mappilla Marumakkattayam Act has not made any discrimination and the charging
section is not liable to be struck down on the ground that the Mappilla family
may have to pay tax at a lower rate, whereas a Hindu Undivided Family, by
reason of the amalgamation of the expenditure of all the members of the family,
may have to pay tax at a higher rate.
The appeals fail and are dismissed with
costs. One hearing fee.
V.P.S. Appeals dismissed.