1966 (10) TMI 39 - SC - Income Tax

Whether the assessment on Viswanathan and Narayanan on a half share of the income of the estate of S.N.A.S. Chockalingam Chettiar is valid on a proper construction of the will dated 2nd February, 1943 ? Held that - There is no ambiguity in the terms of the will. The will gives the estate to the grandsons who were in existence and the other male children who may be born after the date of the execution of the will. Legal possession of the legatees was not deferred, and it is not open to the court to speculate whether the testator could have contemplated the birth of any male children to Meenakshi during his lifetime. The High Court was, therefore, right in holding that the estate belonged only to the two grandsons of the testator--Narayanan and Viswanathan--and that they were properly assessed to tax in respect of the income therefrom. Appeal dismissed.

Summary

Issues: Interpretation of a will regarding the devolution of property to grandsons and male children born after the testator's death.

The judgment by the Supreme Court involved a dispute regarding the interpretation of a will executed by Chockalingam Chettiar, devising property to his grandsons and male children born after his death. The will specified that after the testator's lifetime, his grandsons and male children of his son shall inherit the assets and liabilities equally. The issue arose when the Income-tax Officer assessed the income of the property based on the belief that only the grandsons existing at the time of the testator's death were entitled to the estate. This decision was upheld by the Appellate Assistant Commissioner and the Income-tax Tribunal, leading to an appeal to the High Court and subsequently to the Supreme Court.

The main question before the court was whether the possession of the legatees under the will was deferred until a time later than the death of the testator. The court analyzed the provisions of the will and relevant legal principles, including Section 111 of the Indian Succession Act, 1925. The court noted that while the will did bequeath the property to a class of persons, there was no explicit provision deferring possession beyond the testator's death. The court highlighted that the will clearly stated that the grandsons and male children were to take and enjoy the property with absolute rights after the testator's death, without any postponement of possession.

The court rejected the argument put forth by the appellants that the property devolved upon all four grandsons, including those born after the testator's death. The court emphasized that the terms of the will did not support the contention that possession was to be deferred until each member of the class attained majority. The court held that legal possession of the property was not postponed or reserved for any other person, and therefore, only the grandsons existing at the testator's death were entitled to the estate.

Additionally, the court dismissed the argument that the testator could not have anticipated the birth of male children to Meenakshi after his death. The court emphasized that the terms of the will were unambiguous, clearly stating that the estate was for the grandsons in existence and any male children born after the will's execution. The court concluded that the High Court was correct in ruling that the estate belonged solely to the two grandsons at the time of the testator's death, Narayanan and Viswanathan, who were properly assessed for tax on the income from the property.

Ultimately, the appeals were dismissed by the Supreme Court, upholding the decision that only the grandsons existing at the testator's death were entitled to inherit the property as per the terms of the will.