MITTER J. - The question referred under section 66(1) of the Act is :
'Whether, on the facts and in the circumstances of the case, and on a proper construction of the deed of dedication, dated 17th Baisakh, 1303 B. S. (28th April, 1896), the income from the properties covered by the said deed was assessable under section 9 of the Indian Income-tax Act in the hands of the respondent-assessee ?'
The facts laid in the statement of the case are as follows :
The relevant assessment years are 1952-53, 1953-54, 1954-55, 1955-56 and 1956-57, the corresponding previous years being the Bengali years 1358 to 1362 B. S. By an arpannamah dated the 17th Baisakh, 1303 B. S., one Kadambini Dassi and her son, Purna Chandra Daw, created a debutter endowment in respect of their family dwelling house at No. 12, Sib Krishna Daw Lane, Calcutta, in which the ancestral family deity Sri Sri Sridhar Jiew was installed as well as other immovable properties including a temple on the banks of the Ganges at Barrackpore in which the deities Sri Sri Radharaman Jiew and Sridhar Jiew Salgram and six images of Shiva had been enshrined. The deed was executed by the said two persons for selves and as executrix and executor to the estate of the late Haridas Daw. For the assessment years 1952-53, 1953-54 and 1954-55, the assessment was made in respect of the properties covered by the deed on Pulin Chandra Daw, shebait to the Estate Shib Kristo Debutter Estate and for the next two assessment years, namely, 1955-56 and 1956-57, the same assessee was described as trustee to the debutter estate. The income from the debutter estate was assessed under two head : (1) house property under section 9, and (2) other sources under section 12 of the Act. The assessment were confirmed by the Appellate Assistant Commissioner in appeal. In further appeal to the Tribunal however, a different view was taken. The Tribunal found that no trust in the technical sense of the term had been created by the arpannamah and that there was no conveyance in favour of any trustee. Nor in the opinion of the Tribunal was there any formal conveyance of the property in favour of the idols. According to the Tribunal 'what the settlors had unequivocally done was to extinguish their own interests in the property and dedicate the same for certain pious and benevolent purposes to be carried out by the said Purna Chandra Daw and his successors.' In these circumstances, the Tribunal held that, despite the absence of a formal conveyance in their favour, the idols were the legal owners of the property dedicated to them and the correct status of the assessee was that of a shebait or a manager who had no beneficial interest in the property. On this view, the Tribunal held that the assessee was not liable to be taxed under section 9 and that the assessments made in respect of the income from property could not be sustained.
As the whole thing turns on the interpretation of the arpannamah and the rights created thereby, it is necessary to examine the same in detail. Even at the outset it was apparent that the translation of the arpannamah, which was in Bengali, and an annexure to the statement of the case was not a correct rendering of the document in English. Accordingly, we directed that the arpannamah be translated officially by an official translator and interpreter of this court and this was done. By consent of parties the official translation of the arpannamah was marked as an exhibit and the parties proceeded and put their cases basing the arguments on the official translation.
The executants of the document, as already noted, were Sreemati Kadambini Dassi, widow of late Shib Krishna Daw, and Purna Chandra Daw, son of late Shib Krishna Daw for selves and as executor and administrator respectively to the estate of late Haridas Daw. The material provisions of the document may be noted as follows :
The deed opens with the words 'This deed of dedication is to the deity to the effect followin : we have our residential house at No. 12, Shib Krishna Daw Lane, and in that house the daily seva of Sri Sri Ishwar Sridhar Jiu is carried on and regular annual celebrations of Sri Sri Ishwar Autumnal Durga Puja, Sri Sri Ishwari Shyama Puja, Sri Sri Ishwar Kartic, Sri Sri Ishwari Saraswati Puja and Dol Jatra of Sri Ishwar Sridhar Jiu are performed and according to the family traditions the puja of Sri Sri Ishwari Gandeswari, etc., are daily and regularly performed.
2. Besides this there are one Nababattan and six temples and one Rangamancha, etc,. situate on the banks of Ishwar Bhagirathi in the Mouza Barrackpur and there is also a ghat at Ishwar Bhagirathi and a temple was caused to be constructed wherein the deity Sri Sri Ishwar Radharaman Jiu in pair and the salagram Sri Sri Ishwar Sridhar Jiu and six idols of Lord Siva were installed and were duly consecrated on the 21st of Jaistha, 1297 B.S.
3. There is no other separate doubter property sufficient for the purpose of carrying on the daily seva and other rites of the aforesaid deities and hence whatever properties we have out of the same a pucca three storied building together with the rent free land containing the same being premises No. 56, Clive Street, which has been partitioned - this marked half share and 10 pucca double-storied buildings on Baranashi Ghose Street, etc., we have decided to dedicate these properties for Ishwar Dev seva.
4. Besides the properties already made debutter a market known as Hargunj Bazar together with rent free land thereunder as well as other lands are in our possession.
5. We execute this deed of dedication in respect of the rented house, etc., the said Harganj Bazar, two mouzas in Touzi No. 80 of Burdwan Collectorate, all mentioned in the schedule for performing the share of daily seva of ancestral deity Sri Sri Ishwar Sridhar Jiu, the performance of pujas and festivals and daily and periodical rites as also Sri Sri Ishwar autumnal Durgotsab, etc., and daily seva, pujas, etc., of recently consecrated deities Ishwar Radha Raman Jiu, etc., according to the system mentioned in the schedule to be performed forever and dedicate the same in favour of the deity.
6. Whatever rights and income the executants have in the properties mentioned in the schedule below become debutter.
7. The entire properties included in the deed of dedication in respect of debutter are dedicated by giving the name Sib Krishna Debutter.
8. In order to preserve, maintain and manage this debutter property and for the purpose of running the daily and periodical Deb seva, etc., it seems to be necessary to appoint a trustee and so one of the settlors of the deed of dedication becomes the first trustee of the Deb seva and the property itself was made over to the custody of the said trustee having agreed to carry on all those functions accepted the property, etc., and put his signature on this deed.
9. Purna Chandra Daw is appointed the first trustee.
10. Our descendants in succession according to seniority in age shall become the trustee of the Ishwar Debutter property and shall run the work of daily seva and puja and festivals, etc., of Ishwar deities in accordance with the scheme mentioned.
11. He shall preserve the debutter property and make collections and realisations. He shall not be bound to furnish any account to anybody.
12. He shall spend the income of the Debutter property towards Ishwar Deb Seva work of repairing, etc., as necessary.
13. If there be any surplus left, properties shall be purchased out of the surplus money and the property so purchased shall also be deemed to be debutter property wherein the settlor or their descendants will not have any right of ownership.'
From the above it is quite clear that the settlors divested themselves of all their right, title and interest in the properties and created a debutter. This debutter was not for any one deity in particular but for the seva and worship of all the various deities mentioned in the document as also for the performance of periodical and other pujas enumerated. The properties were put in the custody of Purna Chandra Daw who was to act as the first trustee and the descendants of the settlors according to seniority in age were to become trustees of the debutter property and to perform the daily and periodical rites, functions, etc., in accordance with the scheme laid down. One thing is clear that the trustees as managers were to have no interest in the income of the property excepting a limited right of residence. The entire income was to be spent for daily Deb seva, work of repairing, etc., as might be necessary and the surplus income was to be utilised in purchasing other properties to be made debuttor.
The question then arises as to whether the person who is in charge of the debutter estate can be assessed to Income-tax under section 9 of the Act in respect of the immovable properties of the estate which fetch considerable income. There is no dispute before us with regard to the income from the 'hat', etc., which were assessed in the hands of Pulin Chandra Daw under section 12 of the Act. Under section 9(1) of the Act 'the tax shall be payable by an assessee under the head income from propertyin respect of the bona fide annual value of property consisting of any buildings or lands appurtenant thereto of which he is the owner, subject to certain allowances.' Under sub-section (3) of the section 'where property is owned by two or more persons and their respective shares are definite and ascertainable, such persons shall not in respect of such property be assessed as an association of persons, but the share of each such person in the income from the property as computed in accordance with this section shall be included in his total income.'
It is also necessary to take a note of section 41(1) which was referred the freely by the learned advocates on both sides. The relevant portion of this section reads :
'In the case of income, profits or gains chargeable under this Act which the courts of wards, the Administrator-General, the official trustees or any receiver or manager (including any person whatever his designation who in fact manages property on behalf of another) appointed by or under any order of a court, or any trustee or trustees appointed by a trust declared by a duly executed instrument in writing whether testamentary or otherwise (including the trustee or trustees under any wakf deed which is valid under the Mussalman Wakf Validating Act, 1913) are entitled to receive on behalf of any person, the tax shall be levied upon and recoverable from such court of wards, Administrator-General, official trustee, receiver or manager or trustee or trustees, in the like manner and to the same amount as it would be leviable upon and recoverable from the person on whose behalf such income, profits or gains are receivable, and all the provisions of this Act shall apply accordingly.'
We are not here concerned to find out whether section 41(1) applies but only to see whether the case can be brought under section 9 and assessment made on Pulin Chandra Daw, shebait to the estate of Shib Kristo Debutter Estate as the owner of the properties. It is only when the owner of the debutter estate can be described in this fashion that section 9 would be attracted and not otherwise. We have, therefore, to examine the position of a person who is a shebait of a deity or who holds properties belonging to a debutter estate described as a trustee in the deed of settlement. It was argued by the learned advocate for the Commissioner of Income-tax that on the deed itself it was possible to treat the assessee as a shebait, as a trustee in the ordinary sense and as manager of Shib Kristo Debutter Estate. Our attention was drawn to various passage in Mukherjees Treatise on The Hindu Law of Religious and Charitable Trusts in this connection. There can be no dispute that in the case of a gift to a deity no acceptance is necessary to complete the gift as in the case of secular gifts. According to the learned author' renunciation or utsarga by the donor is sufficient to complete the gift when the property is given to a deity or for religious purposes, and in such cases no acceptance by a sentient being is necessary. But the question status up again, in whom does not the property vest after dedication....... It may by argued that even though the owner loses his proprietary right after dedication he may still retain custody and control of the thing dedicated...... Under the Roman law an individual by dedicating property for a charitable purpose could bring into existence a foundation or institution which in law would be regarded as the owner of the dedicated property........ The idea is the same, namely, when property is dedicated for a particular purpose, the property itself, upon which the purpose is impressed, is raised to the category of a juristic person so that the property which is dedicated would vest in the person so created. In the Hindu debutter it seems that the position is slightly different and in such cases not the whole endowment but the position is which is an embodiment of a pious or benevolent idea constitutes the center of the foundation, is looked upon as the juristic being in which the debutter property vests.' The learned author points out (at page 45 : 'the decisions of the courts of India as well as of the Privy Council have held uniformly that the Hindu idol is a juristic person in whom the dedicated property vests..... The idol as representing and embodying the spiritual purpose of the donor is the juristic person recognised by law and in this juristic person the dedicated property vests'. The author sums up the position according to Hindu law at page 46 in the following word : '(1) According to these sages the deity or idol is the owner to the dedicated property but in a secondary sense. The ownership in its primary sense connotes the capacity to enjoy and deal with the property at ones pleasure. A deity cannot hold or enjoy and property like a man; hence the deity is not the owner in its primary sense; (2) ownership is however, attributed to the deity in a secondary or ideal sense; this is a fiction but not a mere figure of speech, it is a legal fact; otherwise the deity could not be described as owner even in the secondary sense; (3) the fictitious ownership which is imputed to the deity is determined by the expressed intentions of the founder; the debutter property cannot be applied or used for any purpose other than that indicated by the founder. The deity as owner, therefore, represents nothing else but the intentions of the founder..... Neither God nor any supernatural being could be a person in law. So far as the deity stands as the representative and symbol of the particular purpose which is indicated by the donor, it can figure as a legal person and the correct view is that in that capacity alone the dedicated property vests in it.'
Dealing with religious trusts in favour of the idol, the learned author points out at page 15 : 'After a deity is installed, it should be worshipped daily according to Hindu Sastras. The person founding a deity becomes morally responsible for the worship of the deity even if no property is dedicated to it..... The mere fact that an idol has been established does not by itself create a debutter. A religious trust by way of debutter can come into existence only when property is dedicated for worship or service of the idol. When there is no endowment in favour of an established idol, no trust in the legal sense of the term can possibly come into being; it is only the moral duty of the person who founds the deity or his heirs to carry on the worship in such a way as they think proper..... Now property can be given to an idol either at the time when it is consecrated or at any subsequent period and not only such property may be given by the founder or a shebait, it might also consist of offerings of gifts made by the worshipers who are unconnected with the founder or the shebait. When property is given absolutely by a pious Hindu for worship of an idol, the property vests in the idol itself as a juristic person. This view is quite in accordance with the Hindu ideas and has been uniformly accepted in a long series of decisions of the different High Court in Indian as well as by the Judicial Committee..... The Hindu idol is a juridical subject and the pious idea that it embodies is given the status of a legal person and is deemed capable in law of holding property in the same way as a natural person.' 'The idol, deity or religious object' observed West and Buhler in their Digest of Hindu Law, 'is looked upon as a kind of human entity.' It is a sacred entity and ideal personality possessing proprietary rights. The Judicial Committee has pointed out on more occasions than one that it is on in an ideal sense that property can be said to belong to an idol, and the possession and management of it must in the nature of things be entrusted to some person as shebait or manager' Quoting from the judgment of the Judicial Committee in Pramatha Nath v. Pradyumna Kumar it was pointed out that the 'idol has a juridical status with the power of suing and being sued and that its interests are attended to by the person who has the deity is his charge and who is in law its manager with all the powers which would, in such circumstances, on analogy, be given to the manager of the estate of an infant heir.' At page 161 the learned author notes that 'in the conception of debutter therefore two essential ideas are involve : In the first place, the property which is dedicated to the deity vests in an ideal sense in the deity itself as a juristic person. In the second place, the ideal personality of the idol is in nature of things linked up with the natural personality of the shebait, manager of dharmakartha, who as person entrusted with the custody and worship of the idol are obliged and empowered to do what may be required for the service of the idol and for the benefit and preservations of its property. The title to the debutter property is in the idol and not in the shebit, who is not an cannot be a trustee in the sense in which it is used in English law. The shebait is however, a trustees in the general and ordinary sense of the terms..... The shebait holds the debutter property for carrying into effect the pious purpose that are symbolised in the deity, and he is bound to carry out the directions given by the founder, in relations to the worship of the idol and management of its property.'
Dealing with the question of the legal character and incidents of shebaitship, the learned author states at page 19 : 'Shebait is the person entitled to speak on behalf of the deity on earth and holds authority to deal with all its temporal affairs. As regards the temple property the manager is in the position of a trustee, but as regards the service of the temple and the duties that appertain to it he rather in the position of the holder of an officer or dignity.' It is pointed out again at page 19 : 'In a Hindu religious endowment the entire ownership of the dedicated property is transferred to the deity or the institution itself as a juristic person and the shebait or mahant is a mere manager.' It would not be correct to describe shebaitship as a mere office. 'Even when no emoluments are attached to the office of a shebait, he enjoys some sort of right or interest in the endowed property which has partially at least the characteristics of a proprietary right..... The shebaits power to alienate the debutter property is very must limited and can be exercised only when there is a justifying legal necessity or benefit to the deity; yet he can create derivative tenures in respect of the endowed property, which, even if not supported by legal necessity, cannot be impeached so long as he is alive and remains in office. The shebait therefore has to some extent the rights of a limited owner.'
Finally at page 248 : 'Like the trustees in English law, a shebait has to act gratuitously and he cannot charge the debutter estate for any remuneration on account of the time and labour he spends over his affairs. The position would certainly be different if there is a provisions in the deed of dedication to that effect, or, in the absence of any deed of endowment, there is a usage sanctioning such remuneration to the shebait. The law is well established that, in the absence of any provisions in the deed of dedication or any usage to that effect a shebait has no right to take any portion of the income of the debutter estate nor even the surplus that remains after meeting the expenses of the deity. In this income would be included not merely the rents and profits of the debutter property but the offerings which are made to the deity by its devotees.'
In the light the above exposition of the law, the position of a person in charge of Shiv Krishna debutter estate appears to be as follows : He is a mere custodian of the property. It is his duty to carry on all the functions of the deb seva puja, etc., the periodical rites and ceremonies in accordance with the scheme laid down in the deed and preserve the debutter property. Though not liable to render any account to anybody, he is to spend the income of the property towards deb seva work and repairs, etc., only, and invest the surplus in purchasing property to be made debutter. He has only a limited right of residence in some of the debutter properties. So far as the properties covered by the arpannamah are concerned, the founders renounced all their right, title and interest in them. The properties were dedicated for ishwar deb seva, etc : they were dedicated in favour of the deities, the periodical pujas, festival enumerated and to be performed in the manner indicated on stated occasions. The daily seva to be performed is or Sri Sri Ishwar Sridhar Jiew as also of the deities, Sri Sri Ishwar Radharaman Jiew and the other deities, mentioned in the deed. The vesting of the property of therefore in my opinion was in the deities and they were the owners of the property. Although as shebait or as trustees the assessee, Pulin Chandra Daw, may have the custody of the deities as also of the properties, the right to manage the same, the right to let out portions thereof and sue and be sued in respect of the property, he was not the owner. He may have the limited right of ownership in the property in that he can do all acts of management and can even alienate portions of the debutter property in case of legal necessity but the property never vested in him so as to make him the full owner, and, whether or not he could be assessed under section 41 of the Act, on assessment can be made on him as regards the income from the property under section 9. Further, the deities, so far as the ownership of the property is concerned, are not to be treated as an association of persons under sub-section (3) of section 9. Our attention was drawn by the learned advocate for the revenue to certain observations made in the case of Executors of the Estate of J. K. Dubash v. Commissioner of Income-tax reading 'The Income-tax Act directs its attention primarily to the person who receives the income, profits or gains rather than to the ownership or enjoyment thereof. The assessee is defined in section 2(2) as the person by whom Income-tax is payable and by section 10 the tax is payable by an assessee who carries on the business, profession or vocation. The status thus fastens on the person who carries on the business, etc., the liability to pay the tax on the profits earned by him regardless of their destination or enjoyment. It is also worthy of note that in several instances persons who have no proprietary or other right in the income charged to tax are made liable to pay the tax for no other reason than the convenience of assessment and collection. Such instances are to be found in section 26(2). Proviso, section 18(7), section 23A(3), section 25A and section 42(1). As observed by Lord Cave in Williams v. Singer, the fact is that, if the Income-tax Act are examined, it will be found that the person charged with tax is neither the trustee not the beneficiary as such, but the person in actual receipt and control of the income, which it is sought to reach.' These observations were made in the context of quite a different set of circumstances and they do not mean and there never intended to mean that proceedings could be launched under section 9 on a person who was not the owner of the property but could be assessed to income from the property because he was in receipt thereof. If section 9 is to be reported to, assessment can only be made in the hands of the owner, although the payments of the tax may be made though the hands of somebody else. Out attention was also drawn to a judgment of a single judge of this court in Sri Sri Sridhar Jiew v. Income-tax Officer, which relates to this very debutter estate. There, an application was made under article 226 of the Constitution by the deities, Sri Sri Sridhar Jiew and Sri Sri Radharaman Jiew, in the hands of the Pulin Chandra Daw as shebait. There, because of the decision of the Income-tax Appellate Tribunal that Pulin Chandra Daw had no beneficial interest in the property and was not liable to taxation as owner of the properties, notice under section 34 of the Act and addressed to the petitioner-idols, represented by their shebait, was served upon the shebait. It was contended on behalf of the idols that they could not sign any Income-tax a returns and they could not be described as assessee for the purpose of the Income-tax Act. The learned judge observed that, even if the contention about the disability to sign the declaration under an Income-tax return was to be upheld, the admitted income of the idols from the debutter estate did not become immune from assessment because of the special nature of Income-tax proceedings.
We were also referred to various passages occurring in the judgment of a Division Bench of this court in Income-tax Reference No. 50 of 1961 (Commissioner of Income-tax Jogendra Nath Naskar and Hem Chandra Naskar, Shebaits of Sri Sri Kubereswar Mahadev Thakur). The question there was whether the assessments on the deities though the shebaits under the provision of section 41 of the Indian Income-tax Act were in accordance with law. The question was answered in the affirmative and the Divisions Bench examined the status of the shebait as compared to that of a trustee in great detail, and held that the shebait fell within the meaning of the word 'trustee' as used in section 41 of the Act. It had been argued there that a Hindu deity was not assessable or chargeable at all as a unit of assessment under the Income-tax Act. The learned judges held that a Hindu deity could be treated as an individual or as a 'person' both under section 3 and 4 as also under section 41 of the Act. I do not seen how this judgment helps the Commissioner of Income-tax at all. If anything, it cuts at the root of the argument of the revenue authorities under section 9 of the Act.
In Commissioner of Income-tax v. Pulin Behari Dey, the question was whether the shares of the two deities which were not defined in the deed of endowment should be treated as equal thereby attracting the proviso to section 41. There, one Madan Gopal Dey had executed a deed of trust and transferred certain properties to trustees for the maintenance and the worship of two deities. The court pointed out that nothing was left to the discretion of the trustees and the only possible inference which the court could draw was that the settlor intended that the two deities would be given equal shares in the properties. In the result, the court held that the devise to the two deities without specification of shares gave to them the properties in equal shares. That being so, the share of the deities were certain and known and the provision to section 41 of the Indian Income-tax Act could have no application. Mr. Justice Chatterjee pointed out that 'it is only in an ideal sense that a property can be said to belong to an idol and the possession and management of it must, in the nature of things, be entrusted to a manager or shebait. As a general rule of Hindu law, any property given for the maintenance of religious worship and of charities connected with the same is inalienable. Only in exceptional cases, for legal necessity or for the benefit or preservation of the property, the shebait can alienate the same. But, in my view that does not affect the nature of ownership of the property or the share to which the deities are entitled. In my view it only right and property that the two deities should be entitled equally to the income derived from the properties bequeathed or settled under the will and the deed of settlement.' No question of applicability of section 9 was there under consideration and both the learned judges, Harries C.J. and Chatterjee J., were of the view that the income was income of the deities.
A case very much in point came up for consideration by this court in Sree Sree Iswar Gopal Jew v. Commissioner of Income-tax. There, by an instrument of dedication, certain immovable properties were dedicated to the deity, Sree Sree Iswar Gopal Jew, in order to defray the expenses of the daily seva and the periodical festivals of the deity. The deed made provision for meeting the expenses of the seva and puja of the deity out of the income of the dedicated properties and then went on to provide that during her lifetime in her capacity as shebait the settlor would remain in possession of the debutter properties and would also pay the rates and taxes and the costs of repairs of the house, etc. and all other necessary expresses and apply the surplus income to the seva or service of the Thakur. Provisions was also made for devolution of shebaitship. The question arose as to whether the income from the properties of the duty was exempt from assessment to Income-tax under section 4(3)(i) of the Act. The revenue authorities held that there was a private religious trust which did merit exemption. It was held that 'Hindu endowments which are not created through the medium of a trust are included in the words other legal obligation (used in section 4(3)(i). If they are charitable endowments, they have to satisfy the definition of the word charitable.' It was also pointed out that the deity is not a minor and the shebait is not its guardian so as to attract the provisions of section 40 of the Act. The shebait was only the manager of the deity, the human agency through which the purpose of endowment is carried into effect.
In view of all this, there can be no doubt that Pulin Chandra Daw cannot be assessed under section 9 of the Act by describing him either as shebait or as trustee for the deities. The answer to the question purposed be in the negative and in favour of the assessee who will have the costs of this reference.
MASUD J. - I agree.
Question answered in favour of the assessee.