1. The question of law which has been referred to us for our opinion by the Income-tax Appellate Tribunal, Ahmedabad Bench 'B' (hereinafter referred to as the 'Tribunal') under s. 256(1) of the I.T. Act, 1961, has to be answered in the affirmative in view of the settled legal position.
2. There was a Hindu undivided family consisting of Shri Hariprasad Durgaprasad Laskari, his son Shri Anilkumar, the assessee (hereinafter referred to as 'the assessee'), and his wife, Vidyaben (mother of the assessee). The assessee married one Jyotiben on May 20, 1956. There was a partition of the properties of the HUF on 24th July, 1956, in which the assessee received shares worth Rs. 25,516 and cash amount of Rs. 75,000. On the next day, i.e., on July 25, 1956, the assessee settled certain properties which included the shares which he had received on the partition as aforesaid and other shares which he had received by way of gift on a trust. He executed a deed of trust settling these properties on a trust. The trust was created for the benefit of the settlor and his wife, each of whom was to be paid Rs. 100 per month out of the income of the trust up to March 31, 1971. Under the provisions made in the deed of trust, if the settlor, that is, the assessee, were alive on April 1, 1971, the corpus of the trust fund together with accumulations of income was to be transferred to him 'absolutely and as the absolute owner thereof' by the trustees. In other words, an obligation was cast on the trustees to transfer the corpus of the trust and accumulated income to the assessee, if he were alive on April 1, 1971. It is not necessary to set out the other provisions made in the trust, as they are not relevant for the purpose of this reference.
3. In the course of assessment proceedings for the assessment years 1970-71 and 1971-72, the assessee contended before the ITO that he had no right to alienate the properties which he received on the partition of the HUF properties as aforesaid and, therefore, the deed of settlement which he had executed on July 25, 1956, was invalid. The ITO rejected this contention holding that the assessee who was the sole surviving coparcener had a right to alienate the property allotted to him at the partition. In other words, the ITO held that the alienation made by the assessee on July 25, 1956, was legal and valid. The view taken by the ITO, having been confirmed by the AAC in appeal, the assessee preferred a further appeal to the Tribunal.
4. The assessee contended before the Tribunal that although he was the sole surviving coparcener, he had no right to alienate the property inasmuch as when he alienated the property he had a wife who was entitled to claim maintenance of the HUF property. The Tribunal negatived this contention and confirmed the view taken by the lower authorities. The assessee has challenged the view taken by the Tribunal and at his instance, the following question has been referred to us for our opinion :
'Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that that person who, for the time being, is the sole surviving coparcener is entitled to dispose of the coparcenary properties as if it were his separate property, even though he had got a married wife and, therefore, in holding that the alienation by settling the property in trust was legal and valid ?'
5. The manner in which the question is framed makes it clear that the only ground on which the validity of alienation by way of deed of settlement dated July 25, 1956, was challenged was that although the assessee was the sole surviving coparcener, he had no right to dispose of the coparcenary property as if it were his separate property, inasmuch as he had a wife living when the alienation was made. As observed at the outset, the legal position on this controversy is well settled. In this connection, we need only to refer para. 257 at p. 320 under the caption : 'Alienation by sole surviving coparcener' in Mulla's Principles of Hindu Law (14th Edn.), which reads as under :
'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.'
6. There is, therefore, no doubt that the assessee as sole surviving coparcener was entitled to alienate the coparcenary property as if it were his separate property. It would not make any difference whether there was a female member who was entitled to claim maintenance from the coparcenary or HUF property living at the time when the alienation was made. Existence of such female member does not in any way curtail or restrict the right of the sole surviving coparcener to alienate the coparcenary property as if it were his separate property. It must, therefore, be held that the Tribunal was right in taking the view which it took.
7. Before we part with the reference we may mention that Mr. J. P. Shah, learned counsel for the assessee, sought to challenged the alienation also on grounds other than the ground on which it was challenged before the Tribunal. We have not permitted him to do so since, as stated above, challenge to the alienation was confined to only one ground stated above.
8. In the result, we answer the question referred to us for our opinion in the affirmative, that is, against the assessee and in favour of the Revenue.
9. Reference answered accordingly with costs.