C. KRISHNA PRASAD versus C.I.T. BANGALORE

•. KRISHNA PR.ASAD

C.I;T; BANGALoRE

NDYembtr 12~ .. 1974.

{H; R. KHANNA, .Ao C. GUPTA; JJ~]

. ,lrldiai: Inca~. 111:11 Aci, 1922-Sec. 2(31).....;H/nd~· undivided famil;y.....;Whetlie; smg/e unmarrlell· person can constitute an HUF •. · · · · ·

· The BS.leBSee-aJ>PeJiant, with ~ .. father and brother formed ljUF upiO ~t; 30, 1958 when there was partition between them and: the a!sessee got- ~rtain house properties and .vacant s(ies. The ,Partitjon.w115.recognis~d by ti!~ D~part­ment. !!nd an orde~. u/s ~5,A of the Indian ·1ncom~-~l\X Act, J922 was PasSed re· cogmsmg the partition with effect from Nov. 1, 1958; · ·

0n the ctate ofJ.>a~ition·and during .the iieriod e~diils March 31, 1964. the assessee was unmarried, upto 1963-64, the assessee was assessed as an individual, b!lt for the Y~.1964-65,. the assessee filed. .return. showing his.status as an.indi-Vldual but in the course c;>f the assessment procee<lings for 1964'65, he claimed that he should be assessed in ·the st-atils :Of'a HUF.: · · · ·

The I.T.O. did ·not .a~cept .the .claim and held .that the assesseo's .1tatus was tliat of an individual. The order of the I.T.Q, was. affirmed on. appeal by the Appellate Asstt, Commissioner and the nib1111al; ·At the· insiance of the assenec, the following question was referred to the Hiah · Court. . ·

·"Whether. on· the facts and cl-ances .In .the case, ·etc, the. usealeO was rightly .asse&scd iii the status of an individual for th~ assessment yoar 1964-65.''. ·

The High Court" answered the question in"favour. of. the revenue .and ~ the appeal .before this Court. The main question .for decision is whether an un-married male 1Iindu, on partition of .jolnt Hindu family can l>e assessed in the status of HUF even though no other person besides him is member of the alleged fa~ly. . -· .. .

Dismissing the appeal._

.. HELQ: (1) ~ection 4 of~ Act of 192~ ,pi:ovi~es f<?r the, ~arging.of ~ t-.ir:· Oil the· total !ncome of evecy person sub1eot to the cond.1tions prescn~ m that Section;· "Person" haS been defined in .SC:c. 2(31) of the Act an~ includes, inler a/la, an .individual al!d HUF.; [7UDJ

(2) single person, lnale or fe~e; however, dqes not constitute a: famify. He or she •would rem~in, ·what ls 'inherent in ''the :Vecy nature Of thiJi&9,· ail lndf. vi dual, lonely wayfarer lill · per chance , he or she finds· mate.· . ·A family con-sisting of a, sinpe individual is .a, contQKl~ttoa l.n terms. (7110) · ·

The word 'family' always signifies .a• group. Plurality of person's is· an easen· t!al attribute of family •.• [711GJ .. . ·

(3) Ii is well settled that Hittdu joint family co'mists of all IN'~ iu.eauy descended from common ancestor ~ includea ·theit wive& and ~lf!­gbters. . Hindu coparcenary ill much narrower body thl:n tho joint ....... ,. It includes only those persons who acquire by birth an lntcreat in ·~· joint qr .cc>~ property. [711HJ

· (:4) The exprcssio~ "Hindu undivlded family" in the Income tax Act . ii ~ ·in the sense In Which Hindu joint family is undentood under the. various IChoola of Hindu Law. Under the Hindu Law, it is not necessary 'that there mhlmt 1111 :a . male member. The ·joint family continues so long as the'Jrol'Crl¥ w chofwp originally of the joint Hindu family remains in the hands the Widows the memben of the family, and is not divided among them.· [712A-BJ ·

( 5) The share which coparcener obtains on partition of ancestral property is ancestral property as regard bis male !ssue._ As regai;d! other .relati~ns, it is separate property and if the copercener dieK without leaving male issue, 1t p;lMC8 to his heirs by succession. (Mulla'1 Princi1•lt1 of Hindu I.Dw 14th Ed. pase 272 referred to.) [712D·E)

( 6) In view of the above, it cannot be a~nied that the appellant wll!I. the ab· solute owner of the property which fell to hlS s~are as result of part1ti_on and he could deal with his property in any way he hk.ed. In order to detel1D1Jle the statu11 of the asiresaee for tile purpoae of income-tax, one has to look to the rea-lities as they e1;ist at the time of assessment and it would not be correct to prc1j'ect into the matter future possibilities which might or might not .mate~iali_ee_. In !ht instant case, there can hardly be any doubt that the asseasee IS an md1v1dl1&1 and not 11 family. · [7120-H]

A111111t Bhlkappea Patel v. Shankar Ramchandra Patel A.I.R. (30) 19<13 J'.C. 196 referred to and di~tiJlillished.

ClvIL APPELLATE JURISDICTION : Civil appeal No. 1553 (N) of 1970. From the Judgment & Order dated the 10th September, 1969 of lite 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 follow· ing 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. llSl>CSSee-appellant :

"Whether on the facts and in the circumstances of the case the asses~. w,as rightly asseued in the status of an individual for the assessment year 1964-65 ?"

C. Krishna Prasad assessee·appellant along with his father Krishnaswami Naida and brother C. Krishna Kumar formed Hit1du undivided family up to October 30, 1958, wJien there was partition between Krishnaswami Naidu and his two sons. In the said partitjon the assessee got some house propertie.'I 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 parti-tion with effect from November l, 1958.

On the ~ate_ of partition. and also during the .relevant period, i.e., the year endmg on March 31, 1964, the assessee was unmarried. Up '«? the year 1963·64 the m:s~e was assessed in the status of an indi-vidual. For the assessment year 1964-65 the assessee filed renun: showing his status .as an Individual. · In the course, however, of the as~~ssment proceedmgs for the assessment year 1~64-65 the assessei: claimed that he should be assessed in the status of Hindu undivided family. The income-tax officer did not accept the claim of the asses· see ~nd held that his status was that of an individual. The order ·of the . mcome-tax ?fi!.cet was affirmed on appeal by the Appellate AS'J1stant Co~muss1oner and on further appeal by the Appellate Tribu-nal. At the instanee of the assessee, the question reproduced above

was referred to the High Court. '..l'he High °?~ as already men-tioned, agreed with the departmental authonties and answered the question apt the assessee.

The shor1 question w.hic~ arises for ~ctcrmination, as woul? appear from the resume of facts given above, 1s whether an unmam~ male Hindu o~ partition of joint Hindu faJ)lily can be assessed m the status of Hindu undivided family even though no other person besides him is member of !he 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 Hindu undivided family )llay for the purposes of the Indian Income-tax Act be treated as taxable .entity when it consists of single member-rnalc or female." After he.aring the le~~d counsel for the parties, we are of fhe 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 011 the total income of every person subject to the conditions prescribed in that section. "Person" bas been defined in section 2(31) of the Act and includes, inter alia, an individual and Hindu undivided fan.ily. The inherent fallacy of the case set up on behalf of the asses-see-appellan~. in our opinion, is that accordini: to him single indi-vidual can constitute Hindu undivided family and be assessed as such. "Family" connotes g'roup of people related by blood or marriage. According to Shorter Oxford English Dictionary, 3rd F.d. the word "Family" means the group consisting of parents and their children·, whether living toget~er 9r not; in wider sense, all those who are nearly connected by blood 0r ·affinity; person's children regarded collectively; those deseended or claiming descent from common ancestor; house, kindred, lineage; ·race; people or group of peoples. According to Aristotle (Politics I) , 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 lll!lke family and State. It would follow from the above that the word "Family" always signifies group. Plurality of persons is an essential attribute of family. single person, male or female, does not consti-tute family. He or she would remain, what is inherent in the very nature of things, an individual, lonely wayfarer till per chance he or she finds _mate. family consisting of single individual is con-tradiction in terms. Section 2(31) of the Act treats Hindu undivided family as aJ,l 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 Hindu joint f~ly consists of all persons lineally descended frOIJl common ancestor~ and includes their wives and unmarried daughW".s.. Hindu coparcenary is much narrower body than the joint family; it includes only those persoos who acquire

(l) [19661 60 J.T.R. 293.

Qy biqh an interest !I?- the jo:lilt. or coparcenary property, these being the sons, graitdsons, and great-grandsons of the holder of the johlt property for the time being. The plea that there Jilust be at least two male members to form Hind1.1 undivided family as taxable entity ljas no fore~. U~der Hindu law joint family may consist of a. single · i;nale· mem~r and widows of deceased male members. The expression "ijindu qndivided family" in the lneome-tax Act is used In tlic ·sense in whic~ Hindu joint family is understood under the various schoo~ of Hindu Jaw (see Attorney-General of Ceylon v. Ar. Arunachalam Chattiar & Ors.([1]) and· Gowli Buddana v. Commissioner of /ncome-tax Myfiore {supra), In the case of Commissioner of /neome-tax Madras v. Ram Ar. Ar. Veerappa Chettiar([2 ]) this Court observed that underi the ·Hindu law it is not predicated of Hindu jdint family th1tt there must be male member. It was accordingly held that so long as the property which w_as originally of the joint Hindu family remains In the hands of the widows of the member~ of the' fainily and iS not divided atnong ·them, the joint family continues. One thing significant which follows from the above is that the assessment. in the status ()f I\ Hindu undivided family can be made only when there are "two .or more· member& Q.f the Hindu undMded family. · ·

The share ~hich. coparcener obtaill!I on partition of ancesti'1d · property. is ancestral property .as regards his male iss11e. They take an interest in lt. by birth, whether they are in existence at the time cif partition or are born subsequently; Such share, 'however, is ancestral . property only as regards his male j~sue. As regards oth$r relations, i~ is separate property, l!.lld if the coparcener dies without leaving male issue, it _1)8$ses · tO bis h~ by· succession (see p. 272 of Mulla's Principles of Hindu Law 14th Ed). person who for the time being is the sole surviVing copar<:ener is entitled to dispose of- the copar-cenary propert/ as if it were his separate property. He may sell or mortgage the property without legal necessil!Y or he may make a. gift of it. sl>n is subsequently born to him or adopted by him, th~ alienation, whether it is by way of ~ale, mortgage or gift, will . never-thel~ stand, for 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 th.e absolute owner of the property which fell to his share as . result of partition .arid tha_t he ca.ii. deal with it as he wishes. There is admitted· 1Y no female wember in existence who iii entitled to maintenance from the a,!>ove mentioned properti or who is capable ·of adopting son to deceased coparcener. Even _if the assessee-appellant in. future intr<>· duces ~w membei' into the family by adoption or otherwise,. hill present full ownen;hip of the property cannot be effected. Such a· new membt.r on becoming .men11'er of the 1=oparcenary would be entitled to such share in the property as woula remain undisposed of by the assessee. · In . order to determine the status of the assessee for the pur .. pose 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 wbich might or •t not materalise. This would indeed (1) [19SSf34 i.iR~ 42. (2) [1970) 76 I.T.R. 467.

amount to speculation and the same is not permissib~e .e~cursions to .the realm of specul_ation may be legitimate aqd justjiied when one is engaged in the study of. philosophy anq mefapbysi<;s; they are wholly unwarrantaj. when one is . dealiI)g .with .tl!e mundane.· suqject. of the .status of the · assessee for. the purpose of the income.,tax. assessment. For this purpose we have to look. to fac!S as they exist and emerge from the record arid not to what they may or may not .be in future. As things: are at present in the instant CaSe, there Can in mfr vjeW be hardly any doubt that the assessce is an individual atid. xiot. family. · · ·

Mt. Desai on behalf ofthe appellant ·ha8 referred m the case of

Aliarit Bhikaava Patil v. Shankar Ramchandra. Patil.(') As consider-c able ·reliance has been placed up<>n that case, it may be necessary to deal with that case at some length. The dispute in that case was between parties -e:overned bv Hindu law and related to watan lands: The pedigree table of the parties was as under : . -

DHULAPPA

Dhulappa's sons Punnappa and Hanumantappa separated in 1857. The watan l:uils in dispute went to the share of Punna,ppa, Naray!l!l, one . of the sons of Punnappa, separated from him in his . lifetime: Thereafter Punnappa died in 1901. Bhikappa .died in .1905, leav-inl! his widow Oannbai and son Keshav. Narayan died issueless in 1908 leaviiie: two olots of watan lands. .On the remarriage of the Widow of Narayan, those two plots devolved by inheritan~ on Keshav. Keshav died unmarried in 1917. At that time his nearest heir was his collateral Shankar defendant. · · Shankar obtained p<>sses· &Ion in 1928 of the lard in disJ)Ute, which had been left by Keshav

(I) AJ.R; (30) 1943 P. C. 196.

after bringing suit against Ganpbai. In 1930 Gangabai adopted Anant plaintift as son to her deceased husband Bhikappa. In 1932 Ganaabai as ·the next friend of Anant brou,ght suit for possession of the land in dispute against Shankar. The trial court decreed the !uit. On al>l>C81 the ~ Court dismissed the suit for possession. On further appeal the Judicial Committee restored the µecree of the trial court. It was held by the Judicial Committee that the power of Hindu widow to adopt does not come to an end on the death of the sole survivinR coparcener. Neither does it depend upon the vesting or divesting of the estate, nor can the right to aklopt be defeated by partition between the coparceners. The Judicial Com-mittee also held that on the death of sole surviving coparcener. Hindu joint family cannot be finally brought to an end while it is possible in nature or Jaw to add male member to it. The family cannot be at an end while there is still potential mother if that mother in th,e way of nature or in the way of law brings in new male member. The Judicial Committee further held that an adopt-ed son can claim as preferential heir the estate of any person other than his adoptive father if such estate has vested before the adop-tion in some heir other than the adopting mother. ·

The above case. in our opinion, can hardly be of any assistance to the assessee-am>ellant. As would appear from the facts of that case, the auestion involved there related to the adoptibn by wid1ow after the death of the sole survivinR coparcener. The question with which we are concerned, as to whether one individual can constitute Hindu undivided family, was not before the Judicial Committee and it exoressed no opinion - .on that question. AccordinR to Mr. Desai it is imolicit in that iUd.111Dent that from 1917 when Keshav died till 1930 when Anant olaintift was adopted, there was joint Hindu family even thoucli the joint family ·consisted of Gangabai alone. We find it difficult to aiuee with Mr. Desai in this respect As would aopear from the facts of that case, Anant was adoptoo by Ganl?abai as son of Bhikappa. It is now firmly established that the risthts of the adopted son relate back to the date of the adoptive father"s death and the adopted son must be deemed by fiction .of law to have been in existence as the son of the adoptive father at the time of latter's death (see p. 543 of Mullah's Principles of Hindu Law 14th Ed.). This principle of relation back is subject to certain f:x-ceptions but we are not concerned with them. As Bhikhappa died in 1905, Anant should be deemed to have been in existence as the 11on of Bhikappa at the time of latter's death in 1905. necessary corollary of tl1e above legal fiction would be that Anant as the adopt-ed son of Bhikappa would be taken to be in existence during the years 1917 to 1930. Gani?abai consequently cannot be considered to be the sole member of the Hindu -µndivided family during the above period.

There is no merit in the appeal. It is accordingly dismissed with costs.

Appeal dismissed.