Kan Singh, J.
1. We have before us a reference by the Income-tax Appellate Tribunal Bombay Bench 'B' under Section 66(2) of the Indian Income-tax Act, 1922, and the following three questions have been referred to us with the statement of the case :--
'(1) Whether on the facts and in the circumstances of the case, the proper status to be taken in the Income-tax assessment on the assessee is Individual or Hindu Undivided Family ?
(2) Whether on the facts here, with reference to the house properties, income from which are assessed here, Section 9(4) of the Income-tax Act, 1922, was properly applied?
(3) Whether the custom of impartibility is invalid on the ground of its being discriminatory so as to offend Article 14 of the Constitution of India?'
2. Both the learned counsel, for the assessee and the Department, however, agreed that the fate of the case turns on the determination of the first question and accordingly they addressed us only on that question. They also agreed that the other two questions really did not arise in the case.
3. The assessment years in question to which the reference relates are 1958-59, 1959-60 and 1960-61. The relevant previous years are the financial years preceding the three assessment years. The Tribunal has narrated the facts with reference to the assessment year 1958-59, which was typical of the three assessment years. The assessee was Thakur Hari Singh who was formerly the Jagirdar of Haria-dhana in Tehsil Bilara, district Jodhpur. The Income of the assessee which was brought to tax in the assessment year tS58-59 was as follows :
Incomefromproperty.Rs. 9,670/-Incomefromsecurities. . .350/-Incomefrom money-lending. . . 800/-Incomefromsavings banks. . . 191/-Incomefromfixed deposits2,040/-Total Income ----Rs. 13,151/-
4. It was common ground between theassessee and the Department that the aboveincome which arose under the several headswas traceable to the assessee's jagir which wasan ancestral one. The jagir was granted to anancestor of the assessee in the year 1802 bythe then Ruler of the ex-Jodhpur State. Thelast holder of the jagir prior to Thakur HariSingh was his father Thakur Jaswanl Singhwho died in the year 1944. Late Thakur Jaswanl Singh had two sons The elder one wasThakur Hari Singh, the assessee, and the younger one was one Shri Ram Singh Late ThakurJaswanl Singh had granted some agriculturallands and a house to his younger son ShriRam Singh during his life time, vide Annexure-A at page 11 of the paper-book in Samvat year1991 corresponding to 1935. The assesseeThakur Hari Singh filed income-tax returnsfrom 1950-51 to 1652-58 and they were accepted in the status of an Individual.
It has not been clarified in the statement of the case as to what status the assessee had then claimed, though the learned counsel for the assessee submits that even in respect of those years the assessee claimed the status of a Hindu Undivided Family. For the assessment years 1953-54 to 1955-56 the Income-tax Officer completed the assessment of the assessee by taking his status as an individual. The assessee filed appeals before the Appellate Assistant Commissioner and by deciding those appeals the Appellate Assistant Commissioner remanded the cases to the Income-tax Officer by his order dated 11-4-58 to allow reasonable opportunity to the assessee to prove his status. The Income-tax Officer then submitted a remand report on 19-9-59 and eventually the Appellate Assistant Commissioner dismissed the appeals on 11-7-60 and ordered that the income of the assessee be assessed in the status of an individual.
For the assessment year 1956-57, the assessee again filed the returns in the status of Hindu Undivided Family and on 29-9-58 he was assessed in the status of Hindu Undivided Family. For the assessment year under consideration namely. 1958-59, the assessee again claimed the status of a Hindu Undivided Family, but this time the Income-tax Officer again taxed the assessee as an individual in the light of the order of the Appellate Assistant Commissioner dated 11-7-60. Aggrieved by this order the assessee went up in appeal to the Appellate Assistant Commissioner challenging the determination of his status as an individual as against his claim for the status of Hindu Undivided Family. The Appellate Assistant Commissioner observed that the properties had been inherited by the assessee from his father and they were in the nature of impartible properties governed by the law of primogeniture and, therefore, the assessee held them as his absolute properties with the result that the same were assessable in his hands as an individual. This view was taken in the subsequent assessment years also.
The assessee then went up in appeal to the Appellate Tribunal, The Appellate Tribunal noted that in the former State of Jodhpur property like the one that was held by the assessee was governed by the rule of primogeniture and that the junior members of the family were only entitled to be maintained by custom and to have an allowance which was called 'Chhutbhai Bant'. Referring to the grant made by the father of the assessee to his younger son Shri Ram Singh (vide Annex-A on the record), it observed that there was no evidence to show that this grant in 1935 was made in recognition of any right in favour of Shri Ram Singh. It therefore, inferred that the house properties had also been treated as being subject to the rule of primogeniture and they descended on the eldest member of the family, when new succession opened, in the same manner as jagir properties.
The Tribunal also referred to the provisions of the Marwar Land Revenue Act, 1949, and after observing, on the basis of AkheySingh v. Mahaveer Chand , that this was the law even before the Act was passed, it pointed out that the Marwar Land Revenue Act was repealed by Section 263 of the Rajasthan Land Revenue Act, 1956. In its view the result of the repeal of the Marwar Land Revenue Act was to do away with the statutory restrictions found in Chapter X of the Marwar Land Revenue Act, 1949, in relation to Jagir lands. The relevant observations of the Tribunal in this behalf, as contained in para-7 of its order, are as follows: -
'By Section 263 read with the second schedule to the Rajasthan Land Revenue Act, 1956. the Marwar Land Revenue Act 1949 has been repealed. The result of the repeal obviously, is to do away with the statutory restrictions found in Chapter X of the Marwar Land Revenue Act. 1949 in relation to Jagir lands.'
The Tribunal; therefore, reached the con-clusion that with the repeal of the Marwar Land Revenue Act the parties were restored to their personal law which was, according to it, the customary law. In this behalf it observed that the statute only gave legislative recognition to the customary law and the repeal of the statute only restored the customary law. Then after citing the Privy Council case of Commr of Income-tax v. Krishna Kishore. , it held that the in come of the estate in the hands of the asses-see was that of an individual. It also referred to the Supreme Court case in Pushpavathi Vijayaram v P. Visweswar Gajapathiraj AIR 1964 SC 118 and observed that the holder of a customary impartible estate, by a declaration of his intention, could incorporate with the estate his self-acquired immovable property and thereupon the property accrues to the estate and is impressed with all its incidents.
The Tribunal, however, recognised that there could be no incorporation of movable properly. Thus, in its view the aforementioned property, which was the subject-matter of assessment, being immovable property could be incorporated with the impartible estate viz., the Jagir of Hariadhana. This incorporation, according to the Tribunal, had taken place prior to 1949. It, therefore, reached the conclusion that the income of the properties in the hands of the assessee was that of the impartible eslate and consequently it could not be regarded as the income of a Hindu Undivided Family
5. In challenging the view taken by the Tribunal, learned counsel for the assessee, Mr. S.C Bhandari, submits that the Tribunal was in error in thinking that there could be incorporation of self-acquired immovable properties with the impartible estate held by the assessee which, according to the learned counsel was not an impartible estate by custom, but was a grant, though impartible, from the Rulers of the ex-Jodhpur State Without prejudice to this the learned counsel submitted that there was no evidence to show that therewas any intention at any time to incorporate the other immovable properties with the impartible estate by the erstwhile holders of the jagir or by the assessee Learned counsel while granting that the income of the jagir was income of an individual proceeded to submit that it was like any othei self-acquired property of the jagirdar and he could blend the same with the property of the Hindu undivided family of which he was a member along with his descendants
As regards Ihe properties granted to Shri Ram Singh, the voungcr brother of the assessee by his father late Thakur Jaswant Singh in the year 1935, it is pointed out that jagir properties could be given to Shri Ram Singh by way of maintenance, but (here was no limitation or restriction as to what property other than jagir property could be given by Thakur Jaswant Singh as Thakur Jaswant Singh was free to grant properties other than jagir properties to his younger son in any manner he though best and, therefore, the learned counsel maintains that the Tribunal was in error in thinking that the grant in favour of Shri Ram Singh could establish that the other properties formed part of the jagir so as to be impressed with the character of impartibilily.
The learned counsel further submitted that the other properties created out of savings from the income of the jagir properly were nothing but self-acquired property of the holder and like any other member of a Hindu Undivided Family he could throw such properly in the hotchpotch by an expression of his intention to do so Learned counsel placed reliance on Rajindra Bahadur Singh v Rani Raghubans Kunwar. AIR 1918 PC 25, Shiba Prasad Singh v. Prayag Kumari Debi. and Jagadam-ba Kumari v Wazir Narain Singh AIR 1923 PC 59 Learned counsel also submitted that Thakur Hari Singh, the assessee, had got the properties in question from his father late Thakur Jaswant Singh and, therefore, in his hands, they became the ancestral property in which his sons were coparceners
6. On the other hand, Mr C. M. Lodha, appearing for the Department, submitted that by custom even the properties other than jagir properties were impartible in the hands of the assessee jagirdar and the junior members had no right to ask for a share in such properties He invited our attention to the judgment of the Appellate Assistant Commissioner dated 6-5-63 in this behalf wherein the Appellate Assistant Commissioner held that Shri Ram Singh. the younger brother of the assessee only got a 'Chhutbhai Bant' and the whole of the impartible estate including the house properties in dispute descended on the assessee by the rule of primogeniture Mr. Lodha then submitted (hat apart from this there was no evidence whatsoever to show that the assessee had at any time thrown these properties which were his absolute properties in the hotchpotch so that they could belong to Hindu Undivided Family.
Mr. Lodha placed a number of authorities before us to show as to in what manner a self acquired property could be impressed with the character of a Hindu Undivided Family and argued that the present case did not fulfil the required test. The cases cited by him were : Commissioner of Gift Tax v. Satyana-rayanamurthy : AIR1965AP95 , Duggirala Sadasiva v. Bolla Rattin, AIR 1958 AP 145. Keshavlal Lallubhai v. Commissioner of Income-tax (Gujarat) : 44ITR266(Guj) , Subramania Iyer v. Commissioner of Income-tax, Madras, AIR 1955 Mad 623, Damodar Krishnaji v. Commissioner of Income-tax, Bombay South : 46ITR1252(Bom) , M. K. Stremann v. Commissioner of Income-tax, Madras, : 41ITR297(Mad) Commissioner of Income-tax, Bombay City 1 v. M. M. Khanna : 49ITR232(Bom) , A. Natesan v. Commissioner of Income-tax, Madras : 49ITR941(Mad) , Jai Narayan Jai Govind v. Controller of Estate Duty, Madras, : 49ITR105(Mad) and Mallesappa Band-eppa v. Mallappa : 3SCR779 .
7. Before we proceed to deal with the cases placed before us, we would like to address ourselves to the incidents of Jagirs in the former State of Jodhpur and then see whether they afford any guidance in the matter.
8. The Marwar Land Revenue Act was enacted in 1949 and came into force from 6-4-1949. As observed by this Court in , the law contained in Chapter X of this Act was the same as was in force before the Act. Chapter X relates to creation, devolution and transfer of proprietary interests in land Section 169 occurring therein declared that the ownership of all land vested in His Highness the Maharaja and all jagirs, bhoms, sansans, dolis or similar proprietary interest were held and shall be deemed to be held as grants from His Highness. According to Section 170 all grants were to be held by the original grantee or his successors during His Highness' pleasure. Section 171 classifies the estate into three categories namely, (scheduled jagirs, (ii) Listed Jagirs, and (iii) such grants as were not covered by either of the two categories. Section 172 provided for succession to grants and was as follows :--
'Section 172. Subject to the provisions of this Act, and of any other law for the time being in force, succession to all estates or proprietary or sub-proprietary interests in land, hereinafter in this Chapter called grants, shall be in accordance with the personal law (o which the deceased landlord or sub-proprietor was subject.'
This shows that the succession was to be in accordance with the personal law of the deceased land-holder unless any contrary rule was contained in this Act The jagii of the petitioner was a Scheduled Jagir Section 182 provided that succession to Scheduled Jagirs shall be governed by the rule of primogeniture. Then Section 191 provided that no grant shall be transferable except to the extent provided in this Act. Sections 192. 193 and 194 permit-ted only temporary transfers of Jagir lands for limited periods either by way of lease or mortgage. Section 195 which related to assignment of a part of the Jagir to a lineal male descendant was as follows :--
'S. 195. The holder of a Scheduled Jagir may assign a part of the Jagir to a lineal male descendant of his own or of the previous holder who does not succeed to the Jagir;
Provided that the part so assigned shall not be more than what is reasonable, as a provision for his maintenance.'
Section 196 declared that the part so assigned shall continue to be the part of Jagir and the assignee shall be a sub-proprietor. Section 197 provided that a sub-proprietor shall be liable to pay to the landlord the land-revenue and other public demands relating to the part of the jagir held by him. The term 'estate' has been defined by the Marwar Land Revenue Act in Section 4 (iii) of the Act. According to this definition, the term 'estate' means a mahal or mahals held by the same landlord and the definition of the term 'mahal' is as follows :--
'Mahal' means (a) any area not being a survey number which has been separately assessed to land revenue whether such land revenue be payable or has been released, compounded for or redeemed in whole or in part and (b) any other area which the Government may by general or special order declare to be a 'mahal'.
9. Thus, what is an estate is an area not being a survey number which has been separately assessed to land revenue. The term 'survey number' need not detain us and it is sufficient to say that it is an area held by or intended to be settled with a holder under a separate assessment of land revenue in a khalsa village or land.
10. Now, according to Chapter X, whatj devolves by the rule of primogeniture is the grant made by the ruler and grant according to Section 172 means an estate. In other words, it is the area of land granted by the rulerr that is dealt with in Chapter X, and it is that which descends to a single heir in the case of a Scheduled Jagir. Chapter X of this Act, therefore, does not contemplate the devolution of properties other than estates viz., Jagir lands. It is also significant to note that this Chapter does not make any provision for assimilation of other properties with the estate. Para 7 of the Tribunal's judgment, which we have already extracted above, shows that the Tribunal was under the impression that with the repeal of the Marwar Land Revenue Act by Section 263 of the Rajasthan Land Revenue Act the statutory restrictions found in Chapter X of the Marwar Land Revenue Act in relation to jagir lands came to an end. It does not appear that any of the parties invited the attention of the Appellate Tribunal to Section 137 of the Rajasthan Land Revenue Act. 1956. which WHS as follows :--
'S. 137 Succession to estates. - Notwithstanding anything contained in this Act sue-cession to and transfer of, an estate shall be governed and regulated by and be determined in accordance with, the law, usage or practice of the local area in which such estate lies, and such law, usage or practice shall notwithstanding the provisions of Section 263, continue in force for the purpose aforesaid.'
This section thus preserved the provisions of Marwar Land Revenue Act relating to succession to and transfer of estates. The Tribunal was, therefore, not right in thinking that the provisions of Chapter X stood repealed so that the parties would be relegated to the customary law which governed them prior to 1949. Apart from this, in our view, the Tribunal has not correctly appreciated the position regarding the doctrine of incorporation or blending in dealing with the case. In , the question which came up for decision was as to how the holder of an impartible estate can incorporate his other immovable properties with the impartible estate. Their Lordships, of course, were dealing with an estate which was impartible by custom. Their Lordships observed as follows :--
'The holder of an impartible estate even though it is governed by primogeniture in matters of succession by custom is entitled to incorporate other immovable but not moveable properties belonging to him with that estate. The crucial test in such cases being the intention to incorporate which may be expressed or implied by the blending of incomes.'
11. Their Lordships of the Supreme Court reviewed the several decisions in AIR 1964 SC 118 and after referring to the Privy Council case, just referred, observed as follows :--
'Unless the power is excluded by statute or custom, the holder of customary impartible estate, by a declaration of his intention can incorporate with the estate self-acquired property and thereupon, the property accrues to the estate and is impressed with all its incidents, including a custom of descent by primogeniture. 'It may be otherwise in the case of an estate granted by the Crown subject to descent by primogeniture' '
(Underlining (here into ' ') is ours)
12. Their Lordships have thus made it quite clear that the holder of a customary impartible estate can incorporate his self-acquired immoveable property with the impartible estate by a declaration of his intention But their Lordships made it absolutely dear that it may be otherwise in the case of an estate granted by the Crown subject to descent by primogeniture. Regarding incorporation their Lordships then observed as follows :--
'It is clear that incorporation is a matter of intention and it is only where evidence has been adduced to show the intention of the acquirer to incorporate the propertv acquired by him with the impartible estate of which he is a holder that an inference can be drawn about such incorporation In all such cases. the crucial test is one of intention.'
Their Lordships also contrasted the effect of incorporation with the effect of blending of self-acquired properly with the joint family property and they observed as follows:
'The effect of incorporation in such cases is the reverse of the effect of blending self-acquired properly with the joint family properly. In the latter category of cases where a person acquires separate property and blends it with the property of the family of which ho is a coparcener, the separate property loses its character as a separate acquisition and merges in the joint family property, with the result that devolution in respect of that property is then governed by survivorship and not by succession. On the other hand, if the holder of an impartible estate acquires property and incorporates it with the impartible estate, he makes it a part of the impartible estate with the result that the acquisition ceases to be partible and becomes impartible. 'In both cases, however, the essential test is one of intention and so, wherever intention is proved either by conduct or otherwise, an inference as to blending or incorporation would be drawn'.'
(Underlining (here into ' ') is ours)
13. We have perused the record and we find nothing to show that the assessee or prior to him his father had incorporated the immovable properties with the .jagir properties, assuming for the time being that this could be done. Mr. Lodha has only referred to us the following passage occurring in the judgment of the Appellate Assistant Commissioner dated 6-5-63:
'The appellant's father, late Shri Jaswant Singh held all the properties absolutely and gave away certain land and movable and immovable properties to his younger son. Ram Singh. by way of 'Chhuttbhai bunt' The appellant was left out. when the vounger son was given properties apparently because he was to succeed to his father's properties in the capacity of the eldest son It is, therefore, obvious that the properties acquired by late Shri Jaswant Singh out of the income of the impartible estate were merged by him in impartible estate and the appellant succeeded to the enlarged estate by the law of primogeniture It seems to be quite manifest from the above that there was a Custom whereby the impartible estate itself and the properties, movable and immovable, acquired out of the income from the impartible devolved on the eldest son by the law of primogeniture. The fad that the original impartible estate and the accretion there to out of its income were never partitioned and descended to and were held by the eldest son in the eldest line leads to a strong presumption that not only was succession of original impartible estate governed by the law of primogeniture bill the succession lo the properties acquired out of the savings and income of the impartible estate was also governed by the same law.'
By the reasoning embodied in this passage the Appellate Assistant Commissioner reached the conclusion that the properties inherited by the assessee from his father were in the nature of impartible properties or otherwise governed by the law of primogeniture It has, however, been overlooked by the Assistant Commissioner that this was not a partition between the two brothers. If it were so, then the disparity in the shares of the younger brother and the elder brother, if any, could afford some guidance for determining the question whether the rule of primogeniture was being observed even in respect of Immovable properties other than the jagir property. But in the present case Thakur Jas-want Singh was giving his property over which he had absolute power to his younger son. Thakur Jaswant Singh was not fettered by any consideration. He could make provision for his younger son according to his discretion and the property so given may be more or less than what the elder son might ultimately get.
That, in our view, therefore, cannot furnish an instance of impartibility of other immovable properties on any rational consideration. As observed by their Lordships of the Supreme Court this can be taken to have been established only when evidence has been adduced to show the intention of the acquirer to incorporate the property acquired by him with the impartible estate of which he is the holder and apart from these observations of the Appellate Assistant Commissioner no other piece of evidence has been referred to us for showing the incorporation of other immovable properties with the jagir estate Apart from this, as pointed out by their Lordships of the Supreme Court incorporation may not be permissible when the estate is held by virtue of a Crown grant. In the present case, the jagir was a grant from the Rulers of ex-Jodhpur State and, therefore, the doctrine of incorporation does not seem to be applicable.
According to the several provisions of the Marwar Land Revenue Act. which we have already referred, what the law makes really impartible is the estate which is the Mahal or an area of land and not properties dehors the grant. Apart from this it is common ground between the parties that the present properties were not resumed when the jagir of the assessee was resumed under the Ra.jasthan Land Reforms and Resumption of Jagirs Act. The following passage in the statement of the case bears this out:
'The Jagir lands were resumed as a result of the Rajasthan Land Reforms and Resumption of Jagirs Act. 1952. The house properties and other ancestral assets with the assessee were unaffected by the said statute.'
We are, therefore, unable to hold that the properties whose income was to be assessed were part of the impartible estate by virtue of incorporation or otherwise.
14. Both the learned counsel agree that the income derived by a holder of an impartible estate is the income of an individual. Mr. Lodha has also candidly conceded that if the property cannot he said to have been incorporated with the impartible estate, then it could be treated by the holder as his self-acquired property and in that situation he would be free to blend it with the Hindu Undivided Family properties by expression of a clear intention Mr. Lodha also did not dispute the position that if the properties, which were in the hands of late Thakur Jaswant Singh, did not form part of the impartible estate, then on succession -- by the assessee they became the joint family properties vis-avis the sons of the assessee. In view of this we need not refer to the several cases that have been cited by both the learned counsel The bone of contention between the learned counsel ultimately centred on the blending of these properties with the property of the Hindu undivided family.
15. We may now refer to the cases that were cited on this aspect of the case.
16. In AIR 1955 Mad 623 the learned Judges observed as follows:
'Under the Hindu Law, there is no necessity for joint family property to exist in order that there may be a joint family. Where the joint family consists of father and son there is nothing to prevent the father from impressing upon any self-acquired property belonging to him the character of joint family property. 'No formalities are necessary in order to bring this about and the only question is one of intention on the part of the owner of the separate property to abandon his separate rights and invest it with the character of joint family property'.
Where an inference of this sort is sought to be deduced from the conduct of the parties, there might be room for ambiguity and for difference of opinion. There, however, it is the declaration of the owner of the separate property that is the evidence before the Court or the Tribunal, the inference that the character of joint family property is impressed upon the separate property follows, unless the words are incapable of that construction or if it represents merely a future intention not yet given effect to.'
(underlining (here into ' ') is ours)
17. The above passage shows that no formalities are needed for impressing self-acquired property with the characteristics of a joint family property and the only question is one of intention on the part of the owner of the separate property to abandon his separate rights and invest it with (he character of joinl family properly
18. The same view was taken in : 46ITR1252(Bom) ; : 41ITR297(Mad) . : 56ITR353(AP) . : 49ITR232(Bom) and : 49ITR105(Mad) . There arc observations to the same effect in : 3SCR779 Therefore, in the present case the only question is whether at any time the assessee had declared and made his intention quite clear about impressing this properly with the character of the property of Hindu Undivided Family The dictionary meaning of the term 'declare' is 'to make known';'to announce'; to assert'; to make a full statement of' etc., vide Chamber's Twentieth Century Dictionary Revised Edition.
It is noteworthy that the assessee has been filing his returns as Hindu undivided family for quite a number of years. In the assessment year preceding the assessment year we are considering the Department had accepted the status of the assessee as that of Hindu Undivided Family. Therefore, the course of conduct of the assessee as also what he had declared in the returns show that he had expressed the intention about this property being treated as the property of Hindu Undivided Family. According to Rule 19A of the Income-tax Rules the return has to be verified and the assessee has to sign the same as a solemn document. Mr. Lodha strenuously contended that the mere giving of one's status in the return is not tantamount to a declaration of an intention to blend one's property with that of the Hindu Undivided Family. In a solitary instance this may not be so, because the assessment is done on the basis of the income of the previous year and the declaration in the return alone will be of no help for judging the status of the assessee in the year of account, but when this is repeated over a pretty long time and if the preceding year the Department itself accepted that return, then we fail to see how it cannot be predicated that the assessee had not expressed his intention properly.
It is true whatever is done by Income-tax Officer in one assessment year is not res judicata for subsequent assessment year, but that is not the point. The question is whether the assessee had expressed the intention to treat his self-acquired property as the property of the Hindu Undivided Family though we do not propose to go into the question whether declaring one's self-acquired properly as the property of Hindu Undi vided Family will attract gift tax or not. The fact remains that a certain attitude, namely, the assessee was a Hindu Undivided Family, was persisted for a number of years and if in the preceding year the Department itself has accepted the status of the assessee as Hindu Undivided Family, then we can clearly come to the conclusion that the assessee has, by expression of a clear intention, blended his self-acquired properties with the properly of the Hindu Undivided Family and has thereby put it in the hotchpotch,
19. In view of what we have said above, we hold that in the facts and circumstances of the case the proper status of the assessee to be taken in the relevant income tax assessments was Hindu Undivided Family and not that of individual and we answer the question accordingly Since the other questions were not pressed, we do not return any answer respecting them. The parties will bear their own costs of this reference.