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Additional Commissioner of Income-tax Vs. G. Venkataraman - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtChennai High Court
Decided On
Case NumberTax Case No. 209 of 1974 (Reference No. 85 of 1974)
Judge
Reported in[1977]109ITR247(Mad)
ActsHindu Marriage Act, 1955 - Sections 2(1)
AppellantAdditional Commissioner of Income-tax
RespondentG. Venkataraman
Appellant AdvocateA.N. Rangaswami and Nalini Chidambaram, Advs.
Respondent AdvocateK Srinivasan and ;K.C. Rajappa, Advs.
Cases ReferredSee A. R. Raja Kumar v. Narayana Rao
Excerpt:
.....- as matter of fact it was not case of assessee at any stage that daughter was brought up as hindu - assessee again and again asserted that daughter is christian - if daughter is christian then section 2 (1) (c) have no application to her as being pale of hindu fold for whom act was intended - assessee cannot be assessed in status of hindu undivided family for simple reason that appellant's wife is christian and appellant's daughter is christian and he alone happens to be hindu - question referred to court answered in negative. - - before proceeding further to deal with the decision, it is necessary to refer to the provisions of the hindu marriage act, 1955, referred to and relied on by this court in the decision referred to above as well as by the tribunal. sridharan's case..........stated, if such a son of a parent belonging to a twice-born class inducts the child into the hindu family and brings him up as such, then the statute invests him with the status of a hindu and recognises him as a hindu, mr. balasubrahmanyan placed reliance upon the decision in myna boyee v. ootaram [1861] 8 mia 400 (pc). that was a case where the illegitimate children born to a woman of the brahmin caste through an englishman were disentitled to claim inter se as between themselves rights of survivorship though they were considered as hindus, this has no application to the facts of this case. even so, the decision in lingappa goundan v. esudasan ilr [1903] mad 13, cited by the revenue, where the plaintiff therein was not regarded as a hindu by birth as his mother was a christian,.....
Judgment:

Ismail, J.

1. This reference relates to two assessment years 1965-66 and 1966-67. The assessee is a Hindu. On 2nd January, 1960, the assessee married a German Christian lady in the Church of the Sacred Heart according to the rites and ceremonies of the Roman Catholics. The assessee has a daughter by name Christine. The assessee filed the returns in the status of an individual for the two assessment years 1965-66 and 1966-67. Later, relying on the principles enunciated by the Supreme Court in its judgment in N.V. Narendranath v. Commissioner of Wealth-tax : [1969]74ITR190(SC) , that to constitute a Hindu undivided family there need not be two male members, the assessee filed revised returns for these two assessment years in the status of a Hindu undivided family consisting of himself, his wife and his unmarried daughter. In the original return filed in the status of an individual he returned an income of Rs. 21,930 for the assessment year 1965-66. For the assessment year 1966-67 in the original return filed in the status of an individual, he had disclosed a total income of Rs. 24,006 only. But, in the revised return, he disclosed an income of Rs. 9,930 for the assessment year 1965-66 and Rs. 12,006 for the assessment year 1966-67. The difference in the total income in the revised returns was on account of the fact that the assessee, in the returns filed as Hindu undivided family, excluded the remuneration of Rs. 12,000 each year received by him as director of M/s. V. Vijayakumar Mills Ltd. on the contention that it constituted his individual income. The Income-tax Officer accepted the assessee's claim to be assessed in the status of Hindu undivided family and made the assessments accordingly. But he declined to exclude the sum of Rs. 12,000 from the income of the family. However, when the assessee preferred appeals to the Appellate Assistant Commissioner of Income-tax challenging the correctness of the assessment in respect of certain matters, the Appellate Assistant Commissioner took the view that the assessee could not be treated as a Hindu undivided family and assessed as such and he could be assessed only in the status of an individual. Against this order of the Appellate Assistant Commissioner, the assessee preferred two appeals referable to the two assessment years in question and the Tribunal, by its order dated Jane 14, 1973, held that the assessee should be assessed in the status of a Hindu undivided family and accordingly allowed the appeals as far as this aspect is concerned. It is the correctness of this conclusion of the Tribunal that is challenged by the revenue, on the Additional Commissioner of Income-tax, Madras-2, applying for and obtaining a reference of the following question for the opinion of this court :

'Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee's status is Hindu undivided family consisting of himself, his wife and daughter ?'

2. We may straightaway mention that the Tribunal upheld the conten-tion of the assessee on the basis of the decision of this court in R. Sridkaran v. Commissioner of Wealth-tax : [1969]73ITR360(Mad) and also relying upon Explanation (b) to Section 2 of the Hindu Succession Act, 1956, and the corresponding provisions contained in the Hindu Marriage Act, 1955, the Hindu Adoptions and Maintenance Act, 1956, and the Hindu Minority and Guardianship Act, 1956. We may mention that before us also the learned counsel for the assessee very strongly relied upon the observations of this court in R. Sridharan v. Commissioner of Wealth-tax : [1969]73ITR360(Mad) referred to above and the Supreme Court on appeal arising out of the same judgment, namely, Commissioner of Wealth-tax v. R. Sridharan : [1976]104ITR436(SC) and the statutory provisions referred to already and did not put forward any other ground to support the conclusion of the Tribunal and, therefore, we proceed to consider only this question and no other.

3. As far as the decision of this court reported in R. Sridharan v. Commissioner of Wealth-tax : [1969]73ITR360(Mad) is concerned, the facts are as follows: The assessee was a member of a Hindu undivided family and on a partition between the assessee, his brothers, and father, a block of shares in T. V. Sundaram Iyengar and Sons P. Ltd. and three other limited companies were allotted to his share. At the time of the partition, he was not married. Subsequently, he married an Austrian lady, Rosa Maria Steinbchler, under the Special Marriage Act, 1954. A son by name Nicolas Sundaram was born to them on November 29, 1957. Initially, the assessee was assessed to income-tax in the status of an individual on his own declaration. In 1959-60, the assessee claimed the status of a Hindu undivided family consisting of himself and Nicolas Sundaram. The assessee repeated his claim to be treated as a Hindu undivided family for the assessment years 1960-61 and 1961-62. The main contention of the assesses was that Nicolas Sundaram was a Hindu and the property held by him was ancestral property and that, therefore, he has to be assessed in the status of a Hindu undivided family. The revenue negatived the contention. It was that question which ultimately came before this court and this court took the view that the status of the assessee in that case should be treated as that of a Hindu undivided family. While holding so, this court relied upon Explanation (b) to Section 2 of the Hindu Succession Act, 1956, the Hindu Marriage Act, 1955, the Hindu Adoptions and Maintenance Act, 1956 and the Hindu Minority and Guardianship Act, 1956, whose language is in pari materia in each of the Acts. Before proceeding further to deal with the decision, it is necessary to refer to the provisions of the Hindu Marriage Act, 1955, referred to and relied on by this court in the decision referred to above as well as by the Tribunal. Sub-section (1)(a) of Section 2 of the Hindu Marriage Act, 1955, provided that it applied to any person who is a Hindu by religion in any of its forms of developments, including, a Vira-shaiva, a Lingayat or a follower of the Brahmo, Prarthana or Arya Samaj. Section 2(1)(b) provided that the Act applied to any person who is a Buddhist, Jaina or Sikh by religion. Section 2(1)(c) provided:

'This Act applies--.....

(a) to any other person domiciled in the territories to which this Act extends who is not a Muslim, Christian, Parsi or Jew by religion, unless it is proved that any such person would not have been governed by the Hindu law or by any custom or usage as part of that law in respect of any of the matters dealt with herein if this Act had not been passed.'

4. There is an Explanation to Section 2(1) and the said Explanation is as follows :

'Explanation.--The following persons are Hindus, Buddhists, Jainas or Sikhs by religion, as the case may be:--

(a) any child, legitimate or illegitimate, both of whose parents are Hindus, Buddhists, Jainas or Sikhs by religion;

(b) any child, legitimate or illegitimate, one of whose parents is a Hindu, Buddhist, Jaina or Sikh by religion and who is brought up as a member of the tribe, community, group of family to which such parent belongs or belonged; and

(c) any person who is a convert or re-convert to the Hindu, Buddhist, Jaina or Sikh religion.'

5. In this case reliance has been placed only on Explanation (b) because it is that Explanation (b) which deals with a case where one of the parents alone is a Hindu and in R. Sridharan's case : [1969]73ITR360(Mad) as well as in the present case only one of the parents alone is a Hindu, namely, the father. With reference to such Explanation, this court stated in Sridharan's case--See : [1969]73ITR360(Mad) .

'The later statutory law, therefore, expressly provides for the conferment of the status of a Hindu on a person even though such status is doubtful when the personal law of the parties is invoked. All such Acts provide that the expression 'Hindu' shall be construed as if it included a person who, though not a Hindu by religion, is nevertheless a person to whom this Act applies by virtue of the provisions contained respectively in such Acts. Ordinarily, under the personal law, an illegitimate child would take after the religion of the mother. Particularly it is so in the case of regenerate classes. But, as already stated, if such a son of a parent belonging to a twice-born class inducts the child into the Hindu family and brings him up as such, then the statute invests him with the status of a Hindu and recognises him as a Hindu, Mr. Balasubrahmanyan placed reliance upon the decision in Myna Boyee v. Ootaram [1861] 8 MIA 400 (PC). That was a case where the illegitimate children born to a woman of the Brahmin caste through an Englishman were disentitled to claim inter se as between themselves rights of survivorship though they were considered as Hindus, This has no application to the facts of this case. Even so, the decision in Lingappa Goundan v. Esudasan ILR [1903] Mad 13, cited by the revenue, where the plaintiff therein was not regarded as a Hindu by birth as his mother was a Christian, has no application for the reason that the later development of statute law recognises such a status in the child, by an overt act on the part of the father who is a Hindu, who takes him into the fold of the family and brings him up as his son and acknowledges him as his undivided son. Incidentally, it may be mentioned that even under the Mitakshara law, an illegitimate son is entitled to maintenance as long as he lives, in recognition of his status as a member of his father's family and by reason of his exclusion from inheritance even among the regenerate classes : See A. R. Raja Kumar v. Narayana Rao : AIR1953SC433 . If this were so, it is not open to the revenue to say that Nicolas Sundaram who is a legitimate son, who is admittedly entitled to statutory rights of succession under the Special Marriage Act, 1954, cannot under 'any circumstances' be considered or deemed to have the status of a Hindu. It is not in dispute that the assessee is a Hindu. He has during the assessment year in question claimed the status of Hindu undivided family along with his son, Nicolas Sundaram. It is imperative to understand the necessary implications in such a claim made by the assessee. In our view, it obviously means what he says. According to the assessee, his son is in his family and obviously it also reflects his mind that his son is being brought up by him as a Hindu. Cryptically it was contended that there was no evidence that the child was being brought up as a Hindu within the meaning of the Explanation cited above. If the assessee has taken his son into his family and has openly acknowledged him as a member thereto by claiming the status of a joint family, it would be unreasonable to still hold that the subject required further elucidation by way of evidence that the son is being 'brought' up by the father as a member of the family to which the father belongs. It would be strange to insist upon evidence aliunde. The assessee, when he declared that he and his son do form members of a Hindu undivided family, has done so obviously to preserve the solidarity of his family and indeed his religion. His lapse even if it is to be considered as one in marrying outside the community, does not necessarily mean that he is not a Hindu and his legitimate son born of such a lawful wedlock even though in his fold, under his care and protection and brought up by him, is also not a Hindu. In fact, such a status in the son as a Hindu is preserved by the above statutory provisions.'

6. The Supreme Court, while affirming this decision, observed--See : [1976]104ITR436(SC) :

'Under the codifying Acts, namely, the Hindu Marriage Act, 1955, the Hindu Succession Act, 1956, the Hindu Minority and Guardianship Act, 1956, and the Hindu Adoption and Maintenance Act, 1956, the orthodox concept of the term 'Hindu' has undergone a radical change and it has been given an extended meaning. The aforesaid codifying Acts not only apply to Hindus by birth or religion, i.e., to converts to Hinduism but also to a large number of other persons. According to Explantion (b) to Section 2(1) of the Hindu Succession Act, 1956, Hindu Adoptions and Maintenance Act, 1956, and the Hindu Marriage Act, 1955, as also according to Explanation II to Section 3(1) of the Hindu Minority and Guardianship Act, 1956, any child, legitimate or illegitimate, one of whose parents is a Hindu by religion and who is brought up as a Hindu is a Hindu.'

7. After stating the above general proposition, the Supreme Court proceeded to state (page 443) :

'In the present case, Sridharan is a Hindu by birth and was lawfully married to Rosa Maria Steinbchler. Even after his marriage, he did not renounce Hinduism but continued to profess that religion. Having been begotten out of the aforesaid valid and lawful wedlock Nicolas Sundaram is a legitimate child and lineal descendant of Sridharan. There is no material on the record to show that Nicolas Sundaram was not brought up as a Hindu or that he did not conform to the habits and usages of Hinduism or that he was not recognised as a Hindu by the society surrounding him or that he became a convert to another faith. Sridharan has also unequivocally acknowledged and expressly declared that he and his son, Nicolas Sundaram, formed a Hindu undivided family. This declaration in the circumstances, is sufficient, as also found by the High Court, to establish that Nicolas Sundaram was brought up as a Hindu member of the family to which his father belonged.'

8. The above extracts from the decisions of this court as well as the Supreme Court will clearly indicate that for the purpose of applying Explanation (b) to Section 2(1) which we have already extracted, it is necessary to establish that the child in question should have been brought up as a Hindu before the child can be said to be a Hindu. In the particular case with which this court as well as the Supreme Court was concerned, there was a finding that the said child, namely, Nicolas Sundaram, was brought up as a Hindu by his Hindu father. It is on this basis alone we proceeded to consider the facts of the present case where no son is involved but only a daughter, and also to apply the Explanation referred to above. It is not necessary to point out that in this case even according to the assessee, his family consisted of himself, his Christian wife and his Christian daughter. Such a family by no stretch of imagination can be called a Hindu undivided family under the textual Hindu law. The only thing that remains to be considered is whether such a conception which has been admittedly diluted by the statutory provisions and judicial pronouncements will still include a case of the present nature, namely, a family consisting of a Hindu husband, a Christian wife and a Christian daughter, as to constitute a Hindu undivided family. When the proceedings were pending before the Income-tax Officer, the Income-tax Officer expressly asked the assessee to furnish information regarding the nationality and religion of his wife, the place of marriage, whether it was conducted according to the Hindu rites or whether it was performed according to the laws prevailing in a foreign country and whether it was registered according to the special marriage laws prevailing in India as also information regarding the place of birth of the daughter, whether the child was baptized in accordance with the Christian law or whether any function was subsequently done in India in accordance with Hindu religious rites and whether the wife and daughter have become Hindus by conversion at least. The assessee did not choose to answer these questions, but sent a short reply by a letter dated November 19, 1971, wherein he stated :

'With reference to your enquiry regarding the particulars of my wife and daughter, I humbly submit the following position :

1. My wife is a German Christian.

2. My daughter Christine is an Indian Christian.

9. Since I am a Hindu by birth and my properties are ancestral I contend that my status is a Hindu undivided family with my wife and unmarried daughter.'

10. Subsequently in the grounds of appeal before the Tribunal also in ground No. 2, the assessee contended as follows :

'The appellant's family consists of himself as karta, his wife and one unmarried daughter. As decided by the Supreme Court of India in the case of N.V. Narendarnath : [1969]74ITR190(SC) the appellant's status is submitted to be Hindu undivided family. As submitted before the authorities below, the appellant's family still continues to be a Hindu undivided family though the karta's wife and unmarried daughter are not following the Hindu religion exactly. The appellant karta is a Hindu inheriting ancestral properties and his family consists of himself, his wife and unmarried daughter.'

11. Thus, it is clear that the assessee throughout took the stand that his wife is a Christian and his daughter is a Christian, but he alone is a Hindu. Notwithstanding this, he claimed that he, his wife and his daughter constituted a Hindu undivided family of which he was the karta. If the decisions of this court and the Supreme Court referred to above are to be applied to this case, the assessee cannot be assessed in the status of a Hindu undivided family, for the simple reason that the appellant's wife is a Christian and the appellant's daughter is a Christian and he alone happens to be a Hindu and, therefore, the wife and daughter not being Hindus, the Hindu law will not apply to them. As a matter of fact, it is only with reference (o this situation, the decisions referred to above considered the question against the background of Explanation (b) to Section 2(1) of the Hindu Marriage Act, as to when one of the parents happens to be a Hindu, the child will be a Hindu. It is in this context this court as well as the Supreme Court decided that for the purpose of applying the requirement of Explanation (b), the child should have been brought up as a Hindu in the family to which the Hindu parent belongs. In this case, there is absolutely no claim by the assessee that his daughter was brought up as a Hindu in the family to which he belonged so as to invoke the assistance of Explanation (b) to Section 2(1) already extracted.

12. At one stage of the arguments, Mr. K. Srinivasan, the learned counsel for the assessee contended that Explanation (b) to Section 2(1) which we have extracted does not require that the child should be brought up as a Hindu and that the only requirement is that the child should be brought up as a member of the family to which the Hindu parent belongs. Whether this contention is right or not, it is no longer open in view of the basis on which this court as well as the Supreme Court proceeded in the cases referred to above, namely, that the child should have been brought up as a Hindu in order to satisfy the requirement of the Explanation. We are of the opinion that such a requirement is implicit in the language of Explanation (b) itself. That Explanation which we have extracted already will clearly indicate that the child can be said to have been brought up in the family to which its Hindu parent belongs only if it is brought up as a Hindu. If it is not brought up as a Hindu, but the child is brought up as a Muslim, Christian, Parsi or Jew, then there is no question of such a child being brought up as a member of the family to which the Hindu parent belongs. It may also be noticed in this context that the child being brought up as a member of the family to which the Hindu parent belongs or belonged, occurs as a part of the statement, 'who is brought up as a member of the tribe, community, group or family fo which such parent belongs or belonged'. Consequently, the expression 'family' occurring as it does along with the words 'tribe, community, group' must receive the same general meaning as the words 'tribe, community, group' should receive. In this particular case, we have referred to the stand of the assessee himself both in his letter addressed to the Income-tax Officer and in the grounds of appeal filed before the Tribunal. According to him, the family consisted of himself, his wife and the daughter. Consistent with this stand, Mr. K. Srinivasan, the learned counsel for the assessee contended that for the purpose of Explanation (b) to Section 2(1) it is enough if the Christian daughter is brought up as a member of the family of the assessee, namely, the family consisting of himself, his wife and the daughter. We are unable to accept this contention as sound. As we pointed out already, the expression 'family' has to be understood in the context of its finding a place along with the expression 'tribe, community, group'. It is also to be noticed that the expression used is 'family to which such parent belongs or belonged'. Consequently, the 'family' contemplated by this Explanation is the Hindu family to which the Hindu parent belongs or belonged and not the family brought into existence by the said Hindu parent marrying a non-Hindu spouse. If the expression 'family' means only the family of the Hindu father and his wife, the language would have been different and the expression 'belongs' or 'belonged' is inapposite to such context. Therefore, the requirement of this provision is that the child must be brought up as a member of the family to which the Hindu parent belongs, namely, the family of the Hindu parent's parents and brothers, etc., and in that context only the requirement as to the child being brought up as a Hindu arises. If we are to hold that the word 'family' occurring in the Explanation means only the family of a person like the assessee, his wife and his daughter as in this case, we will be compelled to hold that it amounts to stating the obvious thing, because every child will be brought up in the family consisting of its parents and itself unless the child is abandoned or discarded or becomes a destitute. Consequently, it is clear that the family contemplated in Explanation (b) is the uni-religious or the homogeneous family, namely, the Hindu family to which the Hindu parent belongs or belonged and not the heterogeneous family of a Hindu parent, and its non-Hindu spouse and their child with reference to whose sratus the Explanation itself is making provision. In other words, the Explanation provides that even in a case where one of the parents alone is a Hindu, the child will be a Hindu, if it is brought up as a Hindu in the family to which the Hindu parent belongs or belonged, which family would be only a Hindu family. That is why the Supreme Court indicated in the passage already extracted that if the child should be brought up as a Hindu, it must conform to the habits and usages of Hinduism and should be recognised as a Hindu by the society surrounding it. Under these circumstances, we are clearly of the opinion that in the light of the judgment of this court and the Supreme Court referred to above as well as the language of Explanation (b) to Section 2(1) of the Act, .the unmarried Christian daughter of the assessee cannot be considered to be a Hindu for the purpose of application of the statutory provisions. As a matter of fact, it was not the case of the assessee himself at any stage that the daughter was brought up as a Hindu. On the other hand, he asserted again and again that the daughter is a Christian. If the daughter is a Christian, then by virtue of Section 2(1)(c) of the Act, which we have extracted, the Act itself will have no application to her as being outside the pale of the Hindu fold for whom alone the Act was intended. Hence, we are clearly of the opinion that the conclusion of the Tribunal is erroneous in law and, therefore, we answer the question referred to this court in the negative and against the assessee. There will be no order as to costs.


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