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S.M. Zackariah Sahib, at Sathankulam Vs. the Commissioner of Income Tax, Madras - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtChennai High Court
Decided On
Case NumberCase Referred No. 59 of 1948
Judge
Reported inAIR1953Mad85; [1952]22ITR359(Mad); (1952)2MLJ877
ActsIncome Tax Act, 1922 - Sections 4A
AppellantS.M. Zackariah Sahib, at Sathankulam
RespondentThe Commissioner of Income Tax, Madras
Appellant AdvocateK. Srinivasan and ;M.J. Swami, Advs.
Respondent AdvocateC.S. Rama Rao Sahib, Adv.
Cases ReferredPickles v. Foulsham
Excerpt:
.....la resident in british india if he maintains or has maintained for him a dwelling place in british india for a period or periods amounting in all to 182 days or more in that year and is in british india at any time in that year' the latter requisite is satisfied in this case and the dispute is whether the assessee maintained or had maintained for him a dwelling place in british india in the years of account. observed that if the lease of the premises would not put him in any better position so far as having the house and the availability of it, and the power of coming to it were concerned, then it can be said that the house was maintained for the assessee. also observed that in determining a question like residence, one had to consider a bundle of facts and their cumulative..........as follows:'whether on the facts and in the circumstances of the case the applicant had a dwelling place maintained for him and was a resident in british india within the meaning of section 4-a(a) (ii) in the year of account'.the years of assessment in question are 1941-42 and 1942-43. the facts found by the tribunal and adverted to in the statement of the case are these. the assessee, a muhammadan merchant, carried on business in ceylon and usually resided there. his parents lived at sathangulam in the tinnevelly district in a house owned by his mother. the assessee's wife whom he married in 1940 lived some times with his parents and some times with her parents in their respective villages in the tinnevelly district the assessee was remitting monies now and then to his parents for their.....
Judgment:

Viswanatha Sastri, J.

1. The question referred for decision is as follows:

'Whether on the facts and in the circumstances of the case the applicant had a dwelling place maintained for him and was a resident in British India within the meaning of Section 4-A(a) (ii) in the year of account'.

The years of assessment in question are 1941-42 and 1942-43. The facts found by the Tribunal and adverted to in the statement of the case are these. The assessee, a Muhammadan merchant, carried on business in Ceylon and usually resided there. His parents lived at Sathangulam in the Tinnevelly district in a house owned by his mother. The assessee's wife whom he married in 1940 lived some times with his parents and some times with her parents in their respective villages in the Tinnevelly district The assessee was remitting monies now and then to his parents for their maintenance. The assessee visited British India during the years of account and during such visits stayed with his parents in their house at Sathangulam. On these facts the Appellate Tribunal held that the assessee was resident in British India within the meaning of Section 4-A(a) (ii) of the Incometax Act overruling the decision of the appellate Assistant Commissioner. Under the statutory provision above referred to, an individual la resident in British India if he

'maintains or has maintained for him a dwelling place in British India for a period or periods amounting in all to 182 days or more in that year and is in British India at any time in that year'

The latter requisite is satisfied in this case and the dispute is whether the assessee maintained or had maintained for him a dwelling place in British India in the years of account.

2. It cannot be said in this case that the assessee maintained a dwelling place. The house where the assessee stayed during his visits to British India belonged to his mother where she and the assessee's father lived. The expression 'maintains a dwelling place' connotes the idea that the assessee owns or has taken on rent or on a mortgage with possession a dwelling house which he can legally and as of right occupy if he Is so minded, during his visit to British India. That is not the case here for the assessee has no legal right to occupy the house in Sathangulam which belongs exclusively to his mother. The further question is whether it can be said that the assessee 'has maintained for him a dwelling place at Sathangulam'.

3. In our opinion the expression 'has maintained for him' would certainly cover a case where the assessee has a right to occupy or live in a dwelling place during his stay in British India though the expenses of maintaining the dwelling place are not met by him in whole or in part. A member of an undivided Hindu family or of a Malabar 'tarwad' or of an Aliasanthana family has a right to live in the family house when he goes there, though the house is maintained by the manager of the family and not by the assessee from his own funds. If the undivided family is sufficiently affluent or if the members are large enough a separate dwelling house might be set apart by the manager for the occupation of one or more members of the family as a matter of convenience. In such cases it can be said that the assessee has a dwelling place maintained for him by the manager of the family for he has a right to occupy the house during his visits to British India.

4. Would the actual or 'de facto' use or occupation of the house of another person by reason of some relationship or friendship without any kind of right to use or occupy the premises make a person a 'resident' within the meaning of the above definition. The decision in -- 'Loewenstein v. De Salis', (1926) 10 Tax Oas. 424 which proceeds on the basis that an assessee need not be the owner or the lessee of a dwelling place or be holding any proprietary interest therein to make him a resident has been relied upon by Mr. Rama Rao Sahib, the learned advocate for the Commissioner of Incometax. In that case Rowlatt J. observed that if the lease of the premises would not put him in any better position so far as having the house and the availability of it, and the power of coming to it were concerned, then it can be said that the house was maintained for the assessee.

In that case the assessee maintained an establishment for throughout the year in the house and as the director of a limited company in which he held 90 per cent of the shares, the assessee was in a position to occupy the house belonging to the company without applying for or obtaining any formal permission from the company. Rowlatt J. also observed that in determining a question like residence, one had to consider a bundle of facts and their cumulative effect. The House of Lords has laid down the rule that the question of residence is one of fact and degree and depends upon a consideration of various factors. See --'Inland Revenue Commrs. v. Lysaght', (1928) A. C. 217; -- 'Levene v. Inland Revenue Commrs'. (1928) A. C. 234.

5. Mr. srinivasan, learned counsel for the assessee referred us to the decision in -- 'Pickles v. Foulsham', (1925) 9 Tax Cas. 261 particularly to the judgment of Rowlatt J. at pages 275 and 276 of the report. The learned Judge referred to the previous decisions and suggested many points of view from which the question of residence of a person could be viewed. The actual decision in the case was that a person who rented and kept a house for his wife and children in Blackpool in England and who came there now and then on a holiday visit was resident in England even though his employment obliged him to stay in the West Coast of Africa for some years. If there is a rented house and an establishment kept continuously to which the assessee could always come to and if he stayed in the house for some time in the year he would be a resident according to the English decisions. As Rowlatt J. observed 'a good deal depends upon rather minute colouring in a case like this'.

6. In this connection regard must be had also to the habits and usages of the people of this country. In England a man who marries sets up at once a separate establishment for himself and his wife and the parents reside separately from him. In India, at any rate among members of a joint Hindu family, the home of a married man is more often than not the home of his parents. But here the assessee is a Muhammadan and among Muhammadans there is no Joint family and sons have no interest in ancestral property during the lifetime of their parents. Moreover, we are not here concerned with the dictionary meaning of the word 'reside' or 'residence' but with the statutory definition of residence given in Section 4-A(a) (ii) of the Incometax Act.

7. In referring the question to us in the form in which it has been referred the Tribunal evidently required our opinion on the point whether on the facts found by them they could come to the conclusion that the assessee was a resident in British India. The outstanding fact is that the assessee's mother owns a house at Sathangulam and she and the assessee's father permanently reside there. A dwelling house is maintained by the parents and for the parents of the assessee. The recently wedded wife of the assessee lives sometimes with her own parents and sometimes with her parents-in-law. The assessee goes to his mother's house as a visitor. It is not as if he goes there as going at home.

It is not as if the assessee is going to Sathangulam and staying for long periods of time so as to make his mother's house his second home. His business keeps him in Ceylon and his visits to Sathangulam appear to have been sporadic. He has no establishment maintained for him in Sathangulam. The dwelling place at Sathangulam is maintained for the parents of the assessee and not for the assessee himself. The fact that the assessee remits money now and then for the maintenance of his wife or his aged parents does not mean that the dwelling house owned by his mother and in which his parents live becomes a dwelling place maintained for him. He may maintain his wife or parents and from this circumstance it cannot be said that the mother's house is maintained for the assessee. For these reasons we answer the question referred to us in the negative and against the Commissioner of Incometax. The assessee will get Rs. 250/- the costs of this reference.


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