C. Krishna Prasad Vs. C. I. T.
Bangalore [1974] INSC 240 (12 November 1974)
KHANNA, HANS RAJ KHANNA, HANS RAJ GUPTA, A.C.
CITATION: 1975 AIR 498 1975 SCR (2) 709 1975
SCC (1) 160
ACT:
Indian Income tax Act, 1922-Sec. 2(31)-Hindu
undivided family--Whether a single unmarried person can constitute an HUF.
HEADNOTE:
The assessee-appellant, with his father and
brother formed a HUF upto Oct. 30, 1958 when there was a partition between them
and the assessee got certain house properties and vacant sites. The partition
was recognised by the Depart- ment and an order u/s 25-A of the Indian
Income-tax Act, 1922 was passed recognising the partition with effect from Nov.
1, 1958.
On the date of partition and during the
period ending March 31, 1964 the assessee was unmarried, upto 1963-64, the
assessee was assessed as an individual, but for the year 1964-65, the assessee
filed a return showing his status as an individual but in the course of the
assessment proceedings for 1964-65, he claimed that he should be assessed in the
status of a HUF.
The I.T.O. did not accept the claim and held
that the assessee's status was that of an individual. The order of the I.T.O.
was affirmed on appeal by the Appellate Asstt.
Commissioner and the Tribunal. At the
instance of the a the following question was referred to the High Court.
"Whether on the facts and circumstances
in the case, etc, the assessee was rightly assessed in the status of an
individual for the assessment year 1964-65." The High Court answered the
question in favour of the revenue and hence the appeal before this Court. The
main question for decision is whether an unmarried male Hindu, on partition of
a joint Hindu family can be assessed in the status of a HUF even though no
other person besides him is a member of the alleged family.
Dismissing the appeal,
HELD:(1) Section 4 of the Act of 1922
provides for the charging of income tax on the total income of every person
subject to the conditions prescribed in that Section.
"Person" has been defined in Sec.
2(31) of the Act and includes, inter alia, an individual and a HUF. [711D] (2)
A single person. male or female, however, does not constitute a. family. He or
she would remain, what is inherent in the very nature of things, an individual,
a lonely wayfarer till per chance he or she finds a mate. A family consisting
of a single individual is a contradiction in terms. [711G] The word 'family'
always signifies a group. Plurality of persons is an essential. attribute of a
family. [711G] (3) It is well settled that a Hindu joint family consists of all
persons lineally descended from a common ancestor and includes their wives and
unmarried daughters. A Hindu coparcenary is a much narrower body then the joint
family.
It includes only those persons who acquire by
birth an interest in the joint or coparcenary property. [711H] (4) The
expression "Hindu undivided family" in the Income tax Act is used in
the sense in which a Hindu joint family is understood under the various schools
of Hindu Law. Under the Hindu Law, it is not necessary that there must be a
male member. The joint family continues so long as the property which was
originally of the joint Hindu family remains in the hands of the widows of the
members of the family, and is not divided among them. [712A-D] 710 (5) The
share which a coparcener obtains on partition of ancestral property is
ancestral property as regard his male issue. As regards other relations, it is
separate property and if the copercener dies without leaving male issue, it
passes to his heirs by succession. (Mulla's Principles of Hindu Law 14th Ed.
page 272 referred to.) [712D-E] (6) In view of the above, it cannot be denied
that the appellant was the absolute owner of the property which fell to his
share as a result of partition and he could deal with his property in any way
he liked. In order to determine the status of the assessee for the purpose of
income-tax, one has to look to the realities as they exist at the time of
assessment and it would not be correct to project into the matter future
possibilities which might or might not materialise. In the instant case, there
can hardly be any doubt that the assessee is an individual and not a family.
[712G-H] Anant Bhikappea Patel v. Shankar
Ramchandra Patel A.I.R.
(30) 1943 P.C. 196 referred to and
distinguished.
CIVIL APPELLATE JURISDICTION : Civil appeal
No. 1553 (N) of 1970.
From the Judgment & Order dated the 10th
September, 1969 of the Mysore High Court in I.T.R.C. No. 7 of 1968.
S. T. Desai and Vineet Kumar, for the,
appellant.
R. N. Sachthey, for the respondent.
The Judgment of the Court was delivered by
KHANNA, J.-This appeal on certificate is against the judgment of the Mysore
High Court whereby the High Court answered the following question referred to
it under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as
the Act) in the affirmative in favour of the revenue and against the
assessee-appellant :
"Whether on the facts and in the
circumstances of the case the assessee, was rightly assessed in the status of
an individual for the assessment year 1964-65 ?" C. Krishna Prasad
assessee-appellant along with his father Krishnaswami Naidu and brother C.
Krishna Kumar formed a Hindu undivided family up to October 30, 1958, when
there was a partition between Krishnaswami Naidu and his two sons.
In the said partition the assessee got some
house properties and vacant sites. The partition was recognised by the
department and an order under section 25-A of the Indian Income-tax Act, 1922
was passed recognising the partition with effect from November 1, 1958.
On the date of partition and also during the
relevant period, i.e., the year ending on March 31, 1964, the assessee was
unmarried. Up to the year 1963-64 the assessee was assessed in the status of an
individual. For the assessment year 1964-65 the assessee filed a return showing
his status as an individual. In the Course, however, of the assessment
proceedings for the assessment year 1964-65 the assessee claimed that he should
be assessed in the status of a Hindu undivided family. The income-tax officer
did not accept the claim of the assessee and held that his status was that of
an individual. The order of the income-tax officer was affirmed on appeal by
the Appellate Assistant Commissioner and on further appeal by the Appellate
Tribu- nal. At the instance of the assessee, the question reproduced above 711
was referred to the High Court. The High Court, as already mentioned, agreed
with the departmental authorities and answered the question against the
assessee.
The short question which. arises for determination,
as would appear from the resume of facts given above, is whether an unmarried
male Hindu on partition of a joint Hindu family can be assessed in the status
of a Hindu undivided family even though no other person besides him is a member
of the alleged family. This Court in the case of Gowli Buddanna v. Commissioner
of Income-tax Mysore(1) refrained from expressing an opinion on the point
"whether a Hindu undivided family pay for the purposes of the Indian
Income- tax Act be treated as taxable entity when it consists of a single
member-male or female." After hearing the learned counsel for the parties,
we are of the opinion that the question which arises for determination in this
appeal should be answered against the assessee.
Section 4 of the Act provides for the
charging of income-tax on the total income of every person subject to the
conditions prescribed in that section. "'Person" has been defined in
section 2(31) of the Act and includes, inter alia, an individual and a Hindu
undivided family. The inherent fallacy of the case set up on behalf of the
asses- see-appellant in our opinion, is that according to him a single
individual can constitute a Hindu undivided family and be assessed as such.
"Family" connotes a group of people related by blood or marriage.
According to Shorter Oxford English Dictionary, 3rd Ed. the word
"Family" means the group consisting of parents and their children,
whether living together or not; in wider sense, all those who are nearly
connected by blood or affinity; a person's children regarded collectively;
those descended or claiming descent from a common ancestor; a house, kindred,
lineage; a race; a people or group of peoples. According to Aristotle (Politics
1), it is the characteristic of man that he alone has any sense of good and
evil, or just and unjust, and the association of living beings who have this
sense make a family and a State. It would follow from the above that the word
"Family" always signifies a group. Plurality of persons is an
essential attribute of a family. A single person, male or female, does not
constitute a family. He or she would remain, what is inherent in the very
nature of things, an individual, a lonely wayfarer till per chance he or she
finds a mate. A family consisting of a single individual is a Contradiction in'
terms. Section 2(31) of the Act treats a Hindu undivided family as an entity
distinct and different from an individual and it would, in our opinion, be
wrong not to keep that difference in view.
It is well settled that a Hindu joint family
consists of all persons lineally descended from a common ancestor and includes
their wives and unmarried daughters. A Hindu coparcenary is a much narrower
body than the joint family;
it includes only those persons who acquire
(1) [1966] 60 T.T.R, 293.
712 by birth an interest in the joint or
coparcenary property, these being the sons, grandsons, and great-grandsons of
the holder of the joint property for the time being. The plea that there must
be at least two male members to form a Hindu undivided family as a taxable
entity has no force. Under Hindu law a joint family may consist of a single
male member and widows of deceased male members. The expression "Hindu
undivided family" in the Income-tax Act is used in the sense in which a
Hindu joint family is understood under the various schools of Hindu law (see
Attorney-General of Ceylon v. Ar. Arunachalwn Chattiar & Ors.(1) and Gowli
Buddana v.Commissioner of Income-tax Mysore (supra). In the case of
Commissioner of Income-tax Madras v. Ram Ar. Ar. Veerappa Chettiar(2) this
Court observed that under the Hindu law it is not predicated of a Hindu joint
family that there must be a male member. It was accordingly held that so long
as the property which was originally of the joint Hindu family remains in the
hands of the widows of the members of the family and is not divided among them,
the joint family continues. One thing significant which follows from the above
is that the assessment in the status of a Hindu undivided family can be made
only when there are two or more members of the Hindu undivided family.
The share which a coparcener obtains on
partition of ancestral property is ancestral property as regards his male
issue. They take an interest in it by birth, whether they are in existence at
the time of partition or are born subsequently. Such share, however, is
ancestral property only as regards his male issue. As regards other relations,
it is separate property, and if the coparcener dies without leaving male issue,
it passes to his heirs by succession (see p. 272 of Mulla's Principles of Hindu
Law 14th Ed). A person who for the time being is the sole surviving coparcener
is entitled to dispose of the coparcenary property as if it were his separate
property. He may sell or mortgage the property without legal necessity or he
may make a gift of it. If a son is subsequently born to him or adopted by him,
the alienation, whether it is by way of sale, mortgage or gift, will
nevertheless stand, for a son cannot object to alienations made by his father
before he was born or begotten (see p. 320 ibid.). In view of the above it
cannot be denied that the appellant at present is the absolute owner of the
property which fell to his share as a result of partition and that he can deal
with it as he wishes. There is admittedly no female member in existence who is
entitled to maintenance from the above mentioned property or who is capable of
adopting a son to a deceased coparcener. Even if the assessee-appellant in
future intro- duces a new member into the family by adoption or otherwise, his
present full ownership of the property cannot be effected. Such a new member on
becoming a member of the coparcenary would be entitled to such share in 'the
property as would remain undisposed of by the assessee. In order to determine
the status of the assessee for the purpose of income-tax, we have to look to
the realities as they exist at present and it would not be correct to project
into the matter future possibilities which might or might not materalise. This
would indeed (1) [1958] 34 I.T.R. 42.
(2) [1970] 76 I.T.R. 467.
713 amount to speculation and the same is not
permissible excursions to the realm of speculation may be legitimate and
justified when one is engaged in the study of philosophy and metaphysics; they
are wholly unwarranted when one is dealing with the mundane subject of the
status of the assessee for the purpose of the income-tax assessment. For this
Purpose we have to look to facts as they exist and emerge from the record and
not to what they may or may not be in future. As things are at _present in the
instant case, there can in our view he hardly any doubt that the assessee is an
individual and not a family.
Mr. Desai on behalf of the appellant has
referred to the case of Anant Bhikappa Patil v. Shankar Ramchandra Patil.(1) As
considerable reliance has been placed upon that case, it may be necessary to
deal with that case, at some length.
The dispute in that case was between parties
governed by Hindu law and related to watan lands, The pedigree table of the
parties was as under DHULAPPA Punnappa Hanamantappa d. 1901 Gundappa Narayan d.
1902 d. 1908 Ramchandra Bhikkappa d. 1905 =Gangabai Keshav Anant Shankar
Hanmant Babu d. 1917 adopted defendant 1930 plantiff Dhulappa's sons Punnappa
and Hanumantappa separated in 1857.
The watan lands in dispute went to the share
of Punnappa, Narayan, one of the sons of Punnappa, Separated from him in his
lifetime. Thereafter Punnappa died in 1901. Bhikappa died in 1905, leaving his
widow Gangabai and son Keshav.
Narayan died issueless, in 1908 leaving two
plots of watan lands. On the remarriage of the widow of Narayan, those two
plots devolved by inheritance on Keshav. Keshav died unmarried in 1917. At that
time his nearest heir was his collateral Shankar defendant. Shankar obtained possesion
1928 of the land in dispute, which had been left by Keshav (1) A.I.R. (30) 1943
P. C. 196.
714 after bringing a suit, against Gangabai.
In 1930 Gangabai adopted Anant plaintiff 'as a son to her deceased husband
Bhikappa. In 1932 Gangabai as the next friend of Anant brought suit for
possession of the land in dispute against Shankar. The trial court decreed the
suit. On appeal the High Court dismissed the suit for possession. On further
appeal the Judicial Committee restored the decree of the trial court. It was
held by the Judicial Committee that the, power of a Hindu widow to adopt does
not come to an end on the death of the sole surviving coparcener. Neither does
it depend upon the vesting or divesting of the estate, nor can the right to
adopt be defeated by partition between the coparceners. The Judicial Committee
also held that on the death of a sole surviving coparcener a, Hindu joint
family cannot be finally brought to an end while it is possible in nature or
law to add a male member to it. The family cannot be at an end while there is
still a potential mother if that mother in the way of nature or in the way of
law brings in a new male member- The Judicial Committee further held that an
adopted son can claim as preferential heir the estate of any person other than
his adoptive father if such estate has vested before the adoption in some heir
other than the adopting mother.
The above case, in our opinion, can hardly be
of any assistance to the assessee-appellant. As would appear from the facts of
that case, the question involved there related to the adoption by a widow after
the death of the sole surviving coparcener. The question with which we are
concerned, as to whether one individual can constitute a Hindu undivided
family, Was not before the Judicial Committee and it expressed no opinion on
that question.
According to Mr. Desai it is implicit in that
judgment that from 1917 when Keshav died till 1930 when Anant plaintiff was
adopted, there was a joint Hindu family even though the joint family consisted
of Gangabai alone. We find it difficult to agree with Mr. Desai in this respect
As would appear from the facts of that case, Anant was adopted by Gangabai as a
son of Bhikappa. It is now firmly established that the rights of the adopted
son relate back to the date of the adoptive father's death and the adopted son
must be deemed by a fiction of law to have been in existence as the son of the
adoptive father at the time of latter's death (see v. 543 of Mullah's
Principles of Hindu Law 14th Ed.).
This principle of relation back is subject to
certain ex- ceptions but we are not concerned with them. As Bhikhappa died in
1905, Anant should be deemed to have been in existence as the son of Bhikappa
at the time of latter's death in 1905. A necessary corollary of the above legal
fiction would be that Anant as the adopted ,one of Bhikappa would be taken to
be in existence during the years 1917 to 1930. Gangabai consequently cannot be
considered to be the sole member of the Hindu undivided family during the above
period.
There is no merit in the appeal. It is
accordingly dismissed with costs.
S.C. Appeal dismissed.
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