The Official Trustee of West Bengal
For The Trust of Chitr Vs. C.I.T West Bengal, Calcutta  INSC 231 (4
RAY, A.N. (CJ) KHANNA, HANS RAJ MATHEW,
KUTTYIL KURIEN BHAGWATI, P.N.
CITATION: 1974 AIR 1355 1974 SCR (2) 383 1974
SCC (3) 616
Income-tax Act (11 of 1922), s.
3-'Individual',if includes all Hindu deity
On the question whether a Hindu deity is an
'individual' within the meaning of that word under the provisions of the income
tax Act, 1922.
HELD : A Hindu deity falls within the meaning
of the word 'individual' in s. 3 and can be treated as ambit of assessment. It
would naturally be taxed through its she baits who are in possession and
management of its property.
[587-C] As a result of the decision of the
Bombay High Court in C.T. v Ahmedabad Mill Owners, Association, 7 I.T.R. 369
that individual in s. 3 of the Income tax Act,. 1922, must mean a human being,
the income-tax (Amendment) Act, 1939, amended the words "association of
individuals" in the section into "association of persons"; but
the word individual', being the first of the six assessable units mentioned in
the section, was retained and was not amended into 'person'. It was not changed
into "person" because the word 'person' is of wider import and
includes any company or association or body of individuals whether in
corporated or not. So, a word had to be chosen which would not carry with it
the wider import of the word 'Person' and the word individual was retained.
After the amendment it was pointed cut by this Court in Commissioner of Income
tax v. Sodra Devi (32 I.T.R. 615) that the word individual not only means a
human being, but also includes a corporation created by a statute. A Hindu
deity is a juristic person capable of holding property. As it can hold property
and be in receipt of Income and can also sue and be sued in a court of law
there is no reason why its income should be held to be out- side the ambit of
taxation since it can be brought within it without straining the language of
the statutory provision.
[586E-H; 587B-C] Jogendra Nath Naskar v.
Comr. of Income-tax (1969) 74, I.T.R. 33 (S.C.), followed Commissioner of
Income tax V. Salem District Urban Bank Ltd.
8 I.T.R. 269, Commr. of Income-tax v. Bar
Council, 12, I.T.R. 1, Sir Currimbhoy Ebrahim Baronetcy Trust v. Commr.of
Income-tax, 5. I.T.C. 484, referred to.
I.T.C. v. Jogendra Nath, A.I.R. 1965 Cal. 570
and Sri Sridhar v. I.T. Office)'. A.I.R, 1966 Cal. 494, approved.
CIVIL APPELLATE JURISDICTION : Civil Appeals
Nos. 2358-2366, of 1968 & 1174, 1288-1299 of 1971.
From the judgment and Order dated the 4th
January, 1966 of the, Calcutta High Court in Income Tax Reference No. 25 of
Purshotham Chatterjee, P. K. Chakravarthy and
Prodyot Kumar Chakravarthy, for the appellant.
V. S. Desai, S.K. Aiyer and R. N. Sachthey,
for the respondent.
The Judgment of the Court was delivered by
ALAGIRISWAMI, J. The question that arises for decision in these,appeals is
whether a Hindu deity is an "individual" within the meaning, of that
word under the provisions of the Indian Income-tax Act, 1922. It arises out of
the judgment of the High Court of Calcutta in a number of references under
section 66(1) of the Act. The facts necessary for the decision, in a short
compass, are these : In the year 1820 one Smt.
584 Chitra Dassi executed an Ekrarnama making
a gift of a piece of land for religious Purposes. In 1842 she executed a will
referring to the fact that she had-earlier made the property debutter and
directed her four sons, the executors, to perform the daily service of Sri
Radhagobindjee. She died in 1855. In 1876 a suit was filed in the Calcutta High
Court praying that the trust should be administered by the court and a scheme
prepared. Subsequently, there were a number of applications made from time to
time and a number of orders were also made on them. In 1929 a scheme of
administration was framed and a little later the (Official Trustee of Bengal
was appointed to be the trustee of the said debutter estate. After the- official
trustee took possession of the properties he was assessed in respect of the
income of the debutter estate in the status of an "individual" under
section 41 of the Act. In respect of the assessment years 1939-40 to 1942-43 a
reference was made under section 66(2) of the Act. A Bench of the Calcutta High
Court held that upon a proper construction of the, relevant documents and the
scheme sanctioned and orders passed by the High Court the property should be
held to be a religious trust. The matter again went up to the High Court in
respect of the assessment years 194344 to 1951-52. Three questions finally came
to be considered by the High Court :
Q.1 Whether upon a proper construction of the
relevant documents executed by Smt. Chitra Dassi and the relevant schemes
sanctioned and orders passed by the High Court, there was a trust in favour of
the Deity or whether there was a dedication of the properties -to the Deity ?
Q.2 Alternatively, if the dedication to the Thakur constitute trust, is it a
religious trust which did not enure to the benefit of the public ? Q.3 Is the
Thakur Radha Gobinda Jew liable to assessment under the Indian Income-tax Act ?
On question No. 1 the High Court held that upon a proper construction of the
relevant documents executed by Chitra Dassi and the relevant Schemes sanctioned
and orders passed by the High Court there was a dedication of the properties to
the deity, but that there was no trust in the technical sense, that is to say,
as understood in the English law. in respect of the first part of the 2nd
question both parties before the High Court agreed that in that question the
word "trust" did not mean a trust in the technical or the English
sense. The High Court pointed out that it has been held that a dedication is a
trust in the general sense within the meaning of the expression as used in
sections 4, 40 and 41 of the Income-tax Act and the word "trust" can
be applied to Hindu endowments. On the second part of the question it was held
that the endowment is a private religious trust and the documents creating it
or confirming it grant no benefit to the members of the public, that an order
made by the Calcutta High Court by which 585 certain directions were given for
feeding the poor, was the only instance in which a benefit enured to the
public. As regards the 3rd question the High Court elaborately discussed
whether the deity could be held to be an "individual" and held that
the deity was liable to assessment under the Income-tax Act.
Before this Court the only point argued was
whether the High Court was right in coming' to the conclusion that the deity is
an "individual". When the High Court dealt with this question it did
not have: the benefit of the decision of this Court in Jogendra Nath Naskar v..
Commr. of Income-tax (1969-74 ITR 33) wherein it was held that a Hindu deity
falls within the meaning of the word "individual" in section 3 and
can be treated as a unit of assessment. Mr. Chatterjee arguing for the
appellant urged that decision was wrong and should, be reconsidered. We find
ourselves in entire agreement with the decision of this Court referred to
above. We shall, however, state our reasons within a short compass.
it was conceded before us on behalf of the
appellant that if the word used had been a "person" instead of an
"individual" the deity would be a person because a person will
include a juristic person. That a Hindu deity is a juristic person is a well
established proposition and has been so for a long time. In Maharanee
Shibessouree Debia v. Mothooranath Acharjo (1869 13 MIA 270) it was observed :
"The Talook itself, with which these
Jimmas were connected by tenure, was dedicated to the religious services, of
the Idol. The rents constituted, therefore, in legal con- templation, its
property. The Sabait had not the legal property, but only the title of Manager
of a religious. endowment." In Prosunno Kumari Debya V. Golab,Chand Baboo
(1875 LR 2 IA 145) the above observations were cited with approval. In Manohar
Ganesh v. Lakhmirmn (1887 ILR 12 Bom. 247) a Division Bench of the Bombay High
Court observed :
"The Hindu law, like the Roman law and
those derived from it, recognises, not only corporate bodies with rights of
property vested in the corporation apart from its individual members, but also
the juridical persons or subjects called foundations......
it is consistent with the giants having been
made to the juridical person symbolized or personified in the idol........
The Madras High Court in Vidyapurna Tirtha
Swami v. Vidyanidhk Tirtha Swami (1904 ILR 27 Mad. 435) expressed the view :
"It is to give due effect to such a
sentiment, widespread and deeprooted as it has always been, with reference to
something not capable of holding property as a natural person, that the laws of
most countries have sanctioned the creation of a fictitious person in the
matter, as is implied 586 in the felicitous observation made in the work
already cited : 'Perhaps the oldest of all juristic persons is the God, here or
the saint." in Pramatha Nath Mullick v. Pradyumna Kumar Mullick (1925 LR
52 IA 245 ; AIR 1925 PC 139) the Privy Council observed "A Hindi idol is,
according to long established authority founded upon the religious customs of
the Hindus, and the recognition thereof by courts of law, a 'juristic entity'.
it has a juridical status with the power of suing and being sued. Its interests
are attended to by the person who has the deity in his charge and who is in law
its manager with all the powers which would, in such circumstances, on analogy,
be given to the manager of the estate of an infant heir.
it is unnecessary to quote the authorities ;
for this doctrine, thus simply stated, is
firmly established." The authorities thus amply establish that a Hindu
deity is a juristic person capable of holding property.
Reference was made to the decision in C. L T.
v. Ahmedabad Mill Owners' Association (7 ITR
369) where Beaumont, C. J. held :
"Individual" where first used, must
mean human being. because it is used as something distinct from a joint family.
firm and company. The whole expression seems to me to mean "every human
being, Hindu undivided family, company, firm and other association of human
beings." Though in consequence of this decision the Income-tax (Amendment)
Act, 1939 amended the words "association of individuals" into
"association of persons". the word "individual" being first
of the six assessable units mentioned in section 3 was retained and was not
amended into "Person". it could not be changed into
"person" for the obvious reason that the word "person" is
of wider import and includes any company or association or body of individuals,
whether incorporated or not. So a word had to be chosen, which would not carry
with it the wider import of the word "person" and the word
"individual" appears to have been chosen. In Commissioner of Income-tax
v. Sodra Devi (32 ITR 615) it was pointed out that the word
"individual" not only means a human being but also includes a
corporation created by a statute, e. g. a University, or a Bar Council or the
trustees of a Baronetcy trust, incorporated by a Baronetcy Act (See the
decisions in Commissioner of Income-tax v.
Salem District Urban Bank Ltd.. 8 ITR 269 ;
Commissioner of Income-tax v. Bar Council, 12 ITR I ; and Sir Currimbhoy
Ebrahim Baronetcy Trust v. Commissioner of Income-tax, 5 ITC 484). But Dass J.
"....... there is no difficulty
whatsoever in my opinion, in giving the word 'individual' its natural meaning,
that is, that the word means either a male or a female." But the court in
that case was not concerned with the problem whether the word
"individual" can refer to a juridical entity. Mukharji J. of 587 the
Calcutta High Court in I T. Commr. v. Jogendra Nath (AIR 1965 Cal. 570) held
that a Hindu deity can be either an individual or a person or both. The same
High Court in Sri Sridhar v. L T. Officer (AIR 1966 Cal. 494) held that a Hindu
idol is a juristic entity who is given the status of a human being capable of
having property and it can be called an "individual".
We are of opinion that as a Hindu deity can
hold property and be in receipt of income and can also sue and be sued in a
court of law there is no reason why its income should be held to be outside the
ambit of taxation if it can be brought within it without straining the language
of the statutory provision. It would naturally be taxed through its shebaits
who are in possession and management of its property. We may, however, mention
that the problem whether the Hindu deity is an individual is not likely to
arise after the enactment of Income-tax Act, 1961 which in clause 31 of section
2 defines a "person" as including (i) an individual, (ii) a Hindu
undivided family. (iii) a company, (iv) a firm. (v) an association of persons
or a body of individuals, whether incorporated or not, (vi) a local authority.
and (vii) every artificial juridical person, not falling within any of the
The appeals are dismissed with costs.
V.P.S. Appeals dismissed.