1945 (1) TMI 20 - HC - Income Tax

Summary

Issues Involved:
1. Whether the maintenance allowance received by the assessee is exempt under Section 14(1) of the Indian Income-tax Act.
2. The nature of impartible estate and its classification as joint family property.
3. The right to maintenance under Hindu law and its implications for tax exemption.

Issue-wise Detailed Analysis:

1. Exemption under Section 14(1) of the Indian Income-tax Act:
The primary issue was whether the maintenance allowance received by the assessee, the mother of the holder of an impartible estate, was exempt from taxation under Section 14(1) of the Indian Income-tax Act. Section 14(1) states, "The tax shall not be payable by an assessee in respect of any sum which he receives as a member of a Hindu undivided family." The Appellate Assistant Commissioner believed the allowance was taxable, while the Appellate Tribunal exempted it under Section 14(1). The court had to determine if the maintenance received by the assessee could be considered as received by a member of a Hindu undivided family.

2. Nature of Impartible Estate:
The court examined whether an impartible estate could be regarded as joint family property. Historical judgments, including Sartaj Kuari v. Deoraj Kuari and Venkata Rao v. Court of Wards, suggested that an impartible estate was the absolute property of the incumbent. However, more recent cases like Baijnath Prasad Singh v. Tej Bali Singh clarified that an impartible estate, though governed by the rule of primogeniture, is still considered joint family property under Hindu law. The court cited Lord Dunedin's observation, "The custom of impartibility does not touch the general law," implying that unaffected incidents of joint family property are still governed by general law. The court concluded that the impartible estate in question could be regarded as joint family property for the purpose of this case.

3. Right to Maintenance under Hindu Law:
The court explored whether the maintenance received by the assessee was due to her right as a member of the joint family or merely a personal obligation of her son. It referenced Mulla's Hindu Law, which states, "A Hindu is under a legal obligation to maintain his wife, his minor sons, his unmarried daughters, and his aged parents." This obligation is personal and arises from the relationship, but it does not negate the right to maintenance from joint family property. The court noted that the assessee's right to maintenance was higher than that of junior family members, as it was a legal obligation. The court also cited Commissioner of Income-tax, C.P. and U.P. v. Rani Rudh Kumari, where it was held that maintenance received by a member of a Hindu undivided family is exempt under Section 14(1). The court concluded that the assessee received maintenance as a member of the Hindu undivided family, thus qualifying for the exemption under Section 14(1).

Conclusion:
The court answered the reference in the affirmative, holding that the maintenance allowance received by the assessee was exempt from taxation under Section 14(1) of the Indian Income-tax Act. The assessee was entitled to her costs, with a hearing fee of Rs. 250.