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Biswa Ranjan Sarvadhikary Vs. Income-tax Officer, F-ward, District Ii(2), Calcutta, and Another. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtKolkata High Court
Decided On
Case NumberCivil Rule No. 4409 of 1959
Reported in[1963]47ITR927(Cal)
AppellantBiswa Ranjan Sarvadhikary
Respondentincome-tax Officer, F-ward, District Ii(2), Calcutta, and Another.
Cases ReferredJoti Prasad Agarwal v. Income
Excerpt:
- .....1956, i am of the opinion that the property income should have been assessed in the hands of the hindu undivided family. you are hereby requested to produced evidence in support of your contention on or before december 15, 1959, failing which i shall be constrained to complete the assessments in the status of a hindu undivided family.'the petitioner thereupon objected to the proposal of assessing the property income in the hands of the petitioner as in the case of a hindu undivided family and this application has been made. the rule issued was a restricted rule and, in fact, only one point needs consideration in this case and has been pressed before me. the question is whether the income of the property in the hands of the petitioner, in the circumstances of the present case, can be.....
Judgment:

The facts in this case are shortly as follows : Sir Deva Prasad Sarvadhikary was a well known solicitor of this court. He died on 10th of August, 1935, leaving his entire assets to his wife, Lady Sarvadhikary, absolutely. On or about the 15th June, 1938, Lady Sarvadhikary by a deed of gift disposed of certain immoveable properties in favour of her eldest son, Normal Chandra Sarvadhikary. The said Nirmal Chandra Sarvadhikary, who was governed by the Dayabhaga school of Hindu law, died intestate on the 29th January, 1940, leaving him surviving the petitioner, Biswa Ranjan Sarvadhikary, as his only son, and his widow, Sm. Satadal Bashini Sarvadhikary. They are his only heirs and legal representatives and became jointly seized and possessed of the said property. It is stated that ever since 1940 they had verbally effected a partition of the said immoveable properties, although there was no separation by metes and bounds. Since 1940 both the petitioner and his mother were separately assessed for payment of income-tax. The petitioner, Biswa Ranjan Sarvadhikary, has been assessed on that footing up to 1954-55 and his mother has been assessed on the same footing up to 1957-58. On or about the 10th December, 1959, the petitioner received a letter from the Income-tax Officer, F-Ward, District II(2), Calcutta, a copy whereof is annexure 'A' to the petition. In this letter it has been stated, inter alia, as follows :

'After taking into consideration the provisions of the Hindu Womens Right to property Act, 1937, and the Hindu Succession Act, 1956, I am of the opinion that the property income should have been assessed in the hands of the Hindu undivided family. You are hereby requested to produced evidence in support of your contention on or before December 15, 1959, failing which I shall be constrained to complete the assessments in the status of a Hindu undivided family.'

The petitioner thereupon objected to the proposal of assessing the property income in the hands of the petitioner as in the case of a Hindu undivided family and this application has been made. The rule issued was a restricted rule and, in fact, only one point needs consideration in this case and has been pressed before me. The question is whether the income of the property in the hands of the petitioner, in the circumstances of the present case, can be assessed on the footing of income in the hands of a Hindu undivided family.

In my opinion, it is clear that it cannot be so assessed. Section 9(3) of the Income-tax Act runs as follows :

'(3) 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 person in the income from the property as computed in accordance with this section shall be included in his total income.'

In this case, the property is owned by two persons and are in their joint possession. The next question is whether their respective share are definite and ascertainable. The position in the case of a Dayabhaga family is quite clear. This is how it has been summarised by Mulla in his Hindu Law, 12th edition, page 520 :

'According to the Dayabhaga law,... each coparcener has, even whilst the family remains undivided, a certain definite share in the joint property of which he is the absolute owner. The property is held in defined shares, though the possession is the joint possession of the whole family. Partition, according to that law, consists in separating the shares of the coparceners, and assigning to the coparceners specific portions of the property.'

Therefore, we find that the petitioner and his mother, being governed by the Dayabhaga school of Hindu law, had defined share in the properties belonging to them jointly and they are in joint possession. It is not necessary to go into the question of verbal partition. Under the circumstances, the petitioner and his mother cannot be assessed as an association of persons, neither can they be assessed on the footing of a Hindu undivided family. The words occurring in sub-section (3) of section 9 are 'association of persons', but the same principles should apply in the cease of a Hindu undivided family. In other words, under sub-section (3), where property is owned by two or more persons governed by the Dayabhaga school of Hindu law, and where their shares are definite and ascertainable, then, although they are in joint possession, the tax will be assessed on the basis of the share of the income in the hands of the assessee, and not as of a Hindu undivided family. That being so, I do not at all understand what the Income-tax Officer meant in his letter dated 10th December, 1959, by saying that after taking into consideration the provisions of the Hindu Womens Right to Property Act, 1937, and the Hindu Succession Act, 1956, he was of the opinion that the property income should be assessed as in the hands of a Hindu undivided family. Under the Hindu Womens Right to Property Act, 1937, the mother got a half-share, but a limited estate. Under the Hindu Succession Act, 1956, the limited shares of Hindu women have become absolute shares. This rather goes to destroy the proposition that the income can be assessed as of a Hindu undivided family. A judgment of the Income-tax Appellate Tribunal, Calcutta Bench, has been cited before me : Sm. Bani Rani Rudra v. Income-tax Officer, District I(2), Calcutta. In that case, the same issue arose. The Income-tax Officer and the Appellate Assistant Commissioner held that section 9(3) was attracted only in the case of an association of persons but did not apply to a Hindu undivided family. This contention was repelled. In that case, the assessee was governed by the Dayabhaga law and her husband died leaving her as his widow and a son. The Appellate Tribunal held that a mistake had been committed and the house property income could not be assessed as in the hands of a Hindu undivided family. This particular point, namely, that under the Dayabhaga law the mother and son would hold definite shares in the property, was considered, but the Appellate Tribunal came to the right conclusion. Mr. Pal, appearing on behalf of the respondent, has argued that the matter has now been judicially determined by the law courts and drew my attention to a decision of the Madras High Court, Joint Receivers, etc. v. Commissioners of Income-tax I do not know how this case is applicable. What happened there was that a father, his two major sons and a minor son, comprised a joint Hindu family, governed by the Madras school of Hindu law. A suit for partition was effected but only a part of the property was divided. It was held that the family should be deemed to continue to be a Hindu undivided family and section 25A of the Income-tax Act directed that in such a case the family should be deemed to continue to exist. It was held that the provisions of section 9(3) of the Act had relevance to a case where two or more persons acquired a property jointly and their shares therein were definite and ascertainable. The section is not attracted to the case of a mere severance of status of the members by partition, in a joint Hindu family. So long as there no partition in definite portions, the Hindu undivided family is the owner of the property for the purposes of assessment to tax of the income of the property. It was held that section 9(3) could not override the special provisions under section 25A. Therefore, the decision turned on the particular facts of the case and was considering the question of a joint Hindu family governed by the Madras school of Hindu law. These principles are not applicable to a Dayabhaga Hindu family and in any event it rather supports than destroys the case of the petitioner, because it definitely states that section 9(3) will apply where two or more persons have joint shares in property which are definite and ascertainable. In the case of a Hindu Dayabhaga family, that is precisely the position. In such cases, there is unity of possession but the parties hold distinct shares. The other case cited before me by Mr. Chatterjee is a decision of the Allahabad High Court, Joti Prasad Agarwal v. Income-tax officer. Again, I am unable to see how this case has any bearing on the issue to be considered here. It was held that, once an income has been charged to tax in the hands of one of the entities mentioned in section 3 of the Income-tax Act, it cannot be charged in the hands of one of the entities mentioned in section 3 of the Income-tax Act, it cannot be charged in the hands of another of those entities subsequently. In the present case, the mother has been assessed up to 1957-58 on the basis of her individual income and yet the petitioner is being sought to be assessed, treating the income in his hands as that of a Hindu undivided family. In any event, it is not necessary to decide the case upon the past conduct of the income-tax authorities. The question to be decided is the position in law. The question is next raised as to whether the petitioner ought to have come to court at this stage. In my opinion, he is entitled to do so. Where a citizen is being sought to be taxed in a manner which is prima facie against the law, he has a right to come to this jurisdiction to have the position clarified at the earliest opportunity. In this case, the Income-tax Officer has no jurisdiction to assess the income in the hands of the assessee as income in the hands of a Hindu undivided family. He has plainly expressed his opinion in his letter dated 10th December, 1959, and it is not enough to say that at the hearing he might change his mind.

The result is that this rule should be made absolute and there will be an appropriate writ directing the respondent not to assess the income mentioned in the petition in the hands of the petitioner as that if a Hindu undivided family, but to make the assessment in accordance with law. There will be no order as too costs.

Order accordingly.


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