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TMI Blog1990 (11) TMI 202X X X X Extracts X X X X X X X X Extracts X X X X ..... ut the capital gain on this basis on the reduced property of the HUF after the death of karta ". 2. Brief facts of the case are that the assessee is a HUF. It consisted of Shri Dharam Pal Singh (karta), Shri Yaduvendra Pal Singh (son), Smt. Laxmi Kumari (wife) and Usha Kumari (unmarried daughter). The karta died on2-9-1982, i.e., after coming into force of the Hindu Succession Act, 1956. 3. The assessee-HUF entered into an agreement to sell the property owned by it and known as "Castle Grant" for a sale consideration of Rs. 65,00,000 on2-5-1982. An agreement of sale was drawn up on26-5-1982by Shri Dharam Pal Singh as karta along with his wife, son and unmarried daughter with purchaser Sahkari Awas Samiti Ltd. Before the sale deed could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al partition of the HUF either in fact or in law. It was submitted that so long as there was no partition the entire property had to be treated as belonging to the HUF and so the capital gains had been correctly computed on the total sale proceeds. It was emphasised that HUF would continue until there was partition by metes and bounds. Relying on the observations of the Supreme Court in the case of State of Maharashtra v. Narayan Rao Sham Rao Deshmukh [1987] 163 ITR 31 it was submitted that notwithstanding the death of Shri Dharam Pal Singh the remaining members of the HUF continued to hold the properties together, though the individual interest of the female members thereof in the family properties had become fixed. 6. Shri Ajay Vohra, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing officer to compute the capital gains on the basis of the reduced property. 7. We have carefully considered the rival submissions as also the facts on record. Before proceeding further with the matter it would be useful to reproduce relevant portion of section 6 of the Hindu Succession Act, 1956, which is as under :--- " 6. When a male Hindu dies after the commencement of this Act, having at that time of his death an interest in a Mitakshara coparcenary property, his interest in the property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with this Act: Provided that, if the deceased had left him surviving a female relative specified in class I of the Schedule or a male relative, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in some detail. It noted that under section 6 of the Hindu Succession Act the main part of the section provided that when a male Hindu dies after the commencement of the Act, having at the time of his death an interest in a Mitakshara coparcenary property, his interest in the property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with the Act. The proviso to section 6, however, set out certain exceptional cases in which the interest of a deceased coparcener in coparcenary property shall devolve not by survivorship, but by testamentary or intestate succession, as the case may be, under the Act. The High Court explained that when the proviso says that the interest of a deceased coparcener ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the Supreme Court in Gurupad Khandappa Magdum's case and the Supreme Court in the subsequent decision held that the earlier decision has to be treated as an authority for the position that when a female member who inherits an interest in a joint family property under section 6 of the Hindu Succession Act files a suit for partition expressing her willingness to go out of the family, she would be entitled to get both the interest she has inherited and the share which would have been notionally allotted to her, but the earlier decision cannot be an authority for the proposition that she ceases to be a member of the family on the death of a male member of the family whose interest in the family property devolves on her without her voliti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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