1970 (1) TMI 82 - HC - Income Tax

Summary

Issues Involved:
1. Whether the arrears of income-tax due by the father in respect of a separate business prior to a partition can be recovered from the sons after the partition under the doctrine of pious obligation.

Detailed Analysis:

Issue 1: Recovery of Father's Income-Tax Arrears from Sons Post-Partition

1. Background and Context:
- The appeal concerns the order of Gopalakrishnan Nair, J., dismissing a Writ Petition that sought a Writ of Mandamus to prevent the collection of income-tax arrears from the sons' properties.
- The father, Venkateswara Rao, and his brother had a partnership business that accrued income-tax arrears. Post-partition, the Income-tax Officer sought to recover these arrears from the properties allotted to the father and sons.

2. Doctrine of Pious Obligation:
- The ancient Hindu Law, as per the Smritis, imposed a pious duty on descendants to pay off the debts of their ancestors to save them from after-death torments.
- The obligation extended to sons, grandsons, and great-grandsons but with varying degrees of liability.
- Judicial decisions have since modified this doctrine, establishing no personal liability for sons unless they received assets from the ancestor.

3. Exceptions to the Doctrine:
- The Smriti texts enumerate exceptions to the general rule, including debts incurred for spirituous liquor, gambling, fines, and taxes.
- The term "avyavaharika" (repugnant to good morals) has been interpreted by courts to exclude debts tainted with immorality or illegality from the son's liability.

4. Judicial Interpretations:
- The Privy Council in Hemraj v. Khem Chand emphasized that debts repugnant to good morals are exempt from the son's liability.
- The Supreme Court in Luhar Amrit Lal Nagji v. Doshi Jayantilal Jethalal and S. M. Jakati v. S. M. Borkar upheld this interpretation, emphasizing the pious duty of sons to discharge debts not tainted with immorality or illegality.

5. Specific Case Analysis:
- The court examined whether the liability to pay income-tax arrears could be considered "avyavaharika" or fall under the enumerated exceptions in the Smritis.
- The court concluded that the liability to pay taxes legally due to the Government is not "avyavaharika" and does not involve moral turpitude.
- The term "sulka" (tax) in the Smritis was analyzed, and the court held that it should be confined to liabilities involving moral turpitude or illegality.

6. Relevant Case Law:
- In M. R. Radhakrishan v. Union of India, the Madras High Court held that non-payment of income-tax does not involve moral turpitude.
- In Chagnti Raghava Reddy v. State of Andhra, the court rejected the argument that income-tax assessed on an estimated income was a penalty and thus exempt from the son's liability.

7. Conclusion:
- The court upheld Gopalakrishnan Nair, J.'s decision that the arrears of income-tax due by the father can be recovered from the sons under the doctrine of pious obligation.
- The writ appeal was dismissed with costs, affirming the sons' liability to pay the father's income-tax arrears.

Final Judgment:
- The writ appeal is dismissed with costs, and the sons are held liable to pay the arrears of income-tax due by their father. The advocate's fee is set at Rs. 250/-.