9911796707
TMI Blog1984 (7) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... at the relevant time both the daughters were married and they could not be a part of the HUF of Shri Chanda. The Commissioner held that up to the date of death of Shri Chanda the income from this property was taxable in the hands of the HUF consisting of Shri Chanda and Smt. Chanda and after that date it was to be assessed as the income of Smt. Chanda in her individual capacity. 2. In the estate duty return filed, the accountable person had claimed that only one-fourth of the value of this property had passed on the death of the deceased. According to this claim, there were four members in the HUF according to the declaration made by Shri Chanda and the deceased had only one-fourth share. The other three-fourth share belonged to the other three members, namely, the wife and the two daughters. The Assistant Controller did not accept this plea and he held that the deceased was governed by Dayabhaga law under which the foundation of the coparcener was laid on the death of the father and not before it. As Shri Chanda did not have any male issue, there was no question of his forming a coparcenary in respect of his self-acquired property. He made a reference to paragraph 227 of Mulla' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal, the learned counsel for the accountable person, Shri V. Gauri Shankar, submitted that he wished to press only the ground regarding the character of the property and the share of the deceased in it and he did not wish to make any submission regarding the valuation of this property. In the grounds taken by the assessee, a reference has again been made to the observations of the Supreme Court in the case of Surjit Lal Chhabda and on the basis of that decision, it is contended that only one-fourth of the value could be included in the principal value of the estate. In the course of hearing it transpired that at the relevant time, prior to the death of the deceased, both the daughters had been married and they were not the members of the HUF of the deceased. After realising this position, the learned counsel for the accountable person was fair enough to restrict his claim on the basis that the property in question belonged to a HUF of the deceased and his wife at the time of death. He, therefore, contended that one-half of the value of the property could alone be included in the property passing on the death of the deceased. We have now to consider this claim of the learned c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nath Chatterjee [1976] 103 ITR 536. In this case it was held that the properties of a Hindu male governed by the DayabhagaschoolofHindulaw, held on his death by his heirs, are not assessable to wealth-tax jointly in the status of HUF. It was so because the coparcenary formed on the death of a father has unity of possession but not unity of ownership on the property. Each coparcener took a defined share in the property and was owner of his share. Each such share thus 'belonged' to the coparcener. The learned counsel submitted that once the position is accepted that the property belonged to the HUF of the assessee and his wife, the conclusion will be that there was unity of possession and the deceased and his wife were tenants-in-common in respect of this property before the deceased's death. 7. The learned counsel in this connection referred to the provisions of section 14 of the Hindu Succession Act, 1956, which provides that any property possessed by a female Hindu shall be held by her as full owner thereof and not as a limited owner. According to the learned counsel, applying this section to the act of throwing the property in common hotch pot, the possession by Mrs. Chanda bec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stem to throw his self-acquired property into the common hotch pot of a HUF. Such HUF need not consist of any other male and there can be a HUF consisting of only one male, the other members being female. It was held in the case of Gowli Buddanna v. CIT [1966] 60 ITR 293 (SC) that the plea that there must be at least two male members to form HUF had no force. It was further held that the property of a joint family does not cease to belong to the family merely because the family is represented by a single coparcener, who possesses rights which an owner of a property may possess. In the case of N. V. Narendranath v. CWT [1969] 74 ITR 190, the Supreme Court held that when the coparcener having a wife and two minor daughters and no son receives his share of the joint family properties on partition, such property, in the hands of the coparcener, belongs to the HUF of himself, his wife and minor daughters and the same cannot be assessed as his individual property. From the above decisions it would be clear that there is no bar in the self-acquired property being impressed with the HUF consisting of the deceased, his wife and two daughters. In the present case the daughters were married a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the Income-tax Act a HUF, not a coparcenary, is a taxable unit, their Lordships pointed out, that wife and daughter are also members of the joint family which may consist of persons lineally descending from a common ancestor and include their wives and unmarried daughters. Only after marriage a daughter ceases to be a member of her father's family and becomes a member of her husband's family. Their Lordships further observed that a joint Hindu family with all its incidents is a creature of law and cannot be created by act of parties except by adoption. Their Lordships further held that it was not necessary to have more than one coparcener to constitute a HUF. They further observed that it was not necessary to have an antecedent history of jointness for having a HUF. After considering the legal position, their Lordships came to the facts of that case and observed as under : " Kathoke Lodge was not an asset of a pre-existing joint family of which the appellant was a member. It became an item of joint family property for the first time when the appellant threw what was his separate property into the family hotch pot. The appellant has no son. His wife and unmarried daughter were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Surjit Lal Chhabda, which was under the Mitakshara law. The position does not appear to be different as pointed out by the Supreme Court in that decision. In these respects the two laws were similar. If that is the position, then the property in question could be considered as a property of the family but it was held by the deceased as the sole coparcener at that time. The wife of the deceased in the circumstances of the case, did not become a coparcener of the joint family consisting of the assessee and his wife. A female could become a coparcener if she steps into the shoes of a coparcener and not otherwise. In such a situation, one has to look into the legal effect of the provisions of the Estate Duty Act 1953 ('the Act') for deciding the question of inclusion of the value of the property in the principal value of the estate of the deceased. Under the Act, duty is levied on the principal value of the estate which passes on the death of a person. Besides, what passes under the general law, the Act has deemed certain properties which are deemed to pass on the death of a person. Section 6 of the Act provides that property which the deceased was at the time of his death compete ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
