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TMI Blog1988 (6) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice in 1969 and is settled in Madras with his family. 3. While completing the assessments under section 143(3) of the Income-tax Act for these years the Income-tax Officer did not accept the assessee's claim to be assessed in the status of a Hindu undivided family for these years, but treated the appellant as a body of individuals and assessed the income at the maximum rate applicable to a body of individuals. We set out below the Income-tax Officer's reasons in support of his conclusions as set out in the assessment order, which are identical for all these years : "The assessee is a Keralite governed by Kerala Nambudri Act, 1958. As far as his personal law is concerned, it is an established fact that the individual wherever he goes carried the same along with him. The Government of Kerala has abolished by an act of legislature the joint family system among Hindus. In the Government of Kerala the relevant act viz. The Kerala Joint Hindu Family System (Abolition) Act, 1975 has come into effect from 1975. In view of this the assessee cannot claim the status of HUF for income-tax purposes. As regards the income shown in the return, it is seen that it has come out of properties he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment years 1974-75 to 1976-77. However, in respect of the remaining seven assessment years 1977-78 to 1983-84, he confirmed the status of body of individuals taken by the Income-tax Officer and dismissed the assessee's appeals. Aggrieved by these orders of the AAC for the seven assessment years 1977-78 to 1983-84, the appellant has come up on further appeal to the Tribunal. 6. Before us, Shri Philip George, the learned counsel for the appellant placed copies of the Kerala Joint Hindu Family System (Abolition) Act, 1975 (Act 30 of 1975 amended by Act 15 of 1978), the bio-data of the appellant and a xerox copy of the Certificate of Naturalisation issued to the appellant by the Government of India on 17-9-1940 under the Indian Naturalisation Act, 1926. On the above materials the learned counsel submitted that the appellant, who was born in Cochin State migrated to British India as early as in 1929 and became a British subject at the time of his joining the service of the Madras Government as an Assistant Instructor in Electrical Engineering at Government Victoria College, Palaghat some time in 1941. The learned counsel further submitted that the appellant was throughout servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1974-75 to 1976-77. In this connection Shri Philip George relied on para 236-A at page 206 of N.R. Raghavachari's Hindu Law 1987, 8th Edition, where the principles of Hindu Law governing migrating families is discussed. 9. Shri Philip George next referred to the following three decisions : (i) Shantilal C. Shah v. CIT [1988] 169 ITR 805 (Ker.) (ii) WTO v. K. Madhavan Nambiar [1988] 169 ITR 810 (Ker.) (iii) P.G. Narayanaswamy v. CIT [1988] 169 ITR 813 (Ker.) He submitted that these decisions show that the Kerala Act was applicable to Hindus residing within the State of Kerala only and not to Hindus residing outside the State of Kerala. He therefore submitted that the AAC erred in rejecting the assessee's contentions in support of his claim to be assessed in the status of a Hindu undivided family. 10. Shri Philip George next argued that alternatively the status of the body of individuals taken by the departmental authorities was clearly unsustainable. He relied on sec. 4 of the Kerala Act and pointed out that while abolishing the system of Hindu joint family among Hindus in the State of Kerala, this provision of law brought about a statutory partition among the members of a Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 Nag. 350. Shri Tilak Chand also referred to Mulla's Hindu Law, pages 88 and 89, para 14, where the topic of migration and school of law is discussed. The learned departmental representative therefore argued that the departmental authorities rightly treated the assessee as a body of individuals in the light of the Kerala Act, which would be applicable to him and therefore there was no merit in the assessee's case. 12. In his reply Shri Philip George submitted that the partition deeds dated 20-10-1949 entered into between the appellant and his brothers, strengthened the assessee's case that he had severed his connections with his native place in 1949 after having migrated to Tamil Nadu ten years earlier and that the decisions relied on by the learned departmental representative clearly showed that the appellant would be governed by the principles of Hindu Law as applicable to him in the year 1930 or 1940 or at any rate in 1949 when he finally severed his connections with his native place after partition between himself and his brothers. He therefore argued that the appellant should succeed in his appeals both on the main ground as well as on his alternative plea. 13. We have car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also no dispute that the assessee is now permanently settled in Madras with his family. The orders of the AAC further shows that the appellant's claim to be assessed as a Hindu undivided family has been accepted by the AAC for the assessment years 1974-75, 1975-76 and 1976-77 and that this decision of the Appellate Asstt. Commissioner has become final, having been accepted by the department. 16. It is further noticed from the bio-data of the appellant that he studied in a school at Calicut from 1929 to 1932 when he appeared for the School Final Examination, that he studied in the Intermediate class in a college at Calicut from 1932 to 1934 and then he joined the Presidency College, Madras in 1934 where he studied up to 1936. Thereafter the appellant studied Electrical Engineering at the Indian Institute of Science, Bangalore from 1936 to 1939. Thereafter in 1941 he joined Madras Government service, the details of which are already set out in the earlier para. It is further stated by the appellant that he separated from his joint family in a partition made in his parent family in 1949 and that the said family partition was effected by two documents dated 20-10-1949, the first do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such migration to give up and renounce the law which they carried with them and adopt the law prevailing in the place to which they have emigrated. But until such an act of renunciation is positively established, the presumption is that the members of the migrating family are still governed by the law of the place of their origin." [Emphasis Supplied] His Lordship quoted with approval the passage at page 89 of Mayne's Hindu Law, 11th Edition. Thereafter his Lordship relied on the decision of the Nagpur High Court in Keshao Rao Bapurao's case and agreed with the said decision. Finally, His Lordship held at page 311 of the reports that the parties in the case before them were governed by the Mayukha law of the Bombay State and that therefore the first defendant was competent to make a valid adoption without the consent of her deceased husband or without the consent of the kinsman of her deceased husband. 20. In Rukhmabai's case the question that arose for consideration was whether the provisions of the Hindu Women's Rights to Property Act of 1937 would apply to parties who had migrated from the native State of Jodhpur to Berar. It was contended on behalf of the first respondent in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of his death." [Emphasis supplied] 21. In Pakula Majhi's case, the Orissa High Court held that the Origh family belonging to Koraput not renouncing personal law when Koraput became part of State of Orissa in 1936 would be governed by the law of inheritance as it prevailed in Madras before 1936. Their Lordships followed the decision of the Privy Council in Balwant Rao v. Baji Rao AIR 1921 PC 59 and other decisions. 22. When we examine the facts of the present case in the light of the four decisions referred to above, it would be clear that the appellant would be governed by the principles of Hindu Law as applicable to him at the time of his migration to Madras which was prevailing at the place of his origin, namely Desamangalam in the old Cochin State at the time of his migration in 1940. This law applicable to the appellant's family would not be affected by subsequent changes which become incorporated in the law of origin after migration. However, he would be governed by Hindu Law as applicable to all Hindus with the changes effected by statutes governing Hindu, domiciled in the old Madras Presidency and now Tamil Nadu State. 23. The argument on behalf of the revenue is that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion by a statutory enactment was not conceived at that time. But that would not furnish any justification to apply section 20 of the Wealth-tax Act to a case to which the provision does not apply. Suffice it to say that no proceedings can be taken under section 20 of the Wealth-tax Act." This decision was followed in Sreepadam's case. At pages 320 and 321 of the reports His Lordship Mr. Justice Paripoornan, held as follows : "The provisions of the Kerala Act 30 of 1975 are clear. The Act is enacted to put an end to the Joint Hindu family in Kerala and the consequence is that from that date onwards, there will be no joint Hindu family in the State. It is a far cry to say that the family is disrupted by partition. Partition is one brought about by act or conduct of parties. In this case, the cessation or extinction of the Hindu undivided family is by the provision of a statute. Section 20 of the WT Act as also the corresponding provision in the IT Act s. 171 of the Act deal only with the case of assessment of a Hindu joint family even after its extinction by partition. They do not provide for the situation arising by reason of extinction by a statutory enactment. If by force of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt is in the case of Sankaranarayanan Bhattathiripad wherein it has been held that where a Nambudiri Illom was assessed and admittedly there had been no division by metes and bounds of their properties after coming into force of the Kerala Act the assessment made in the status of a Hindu undivided family was upheld. The Kerala High Court relied on the decision of the Supreme Court in Kallomal Tapeswari Prasad (HUF) v. CIT [1982] 133 ITR 690. Apparently, the earlier decision of the Division Bench of the Kerala High Court in K. Madhavan Nambiar's case decided on 18th August, 1981, which is now reported as an appendix in K. Madhavan Nambiar's case does not seem to have been brought to the notice of the High Court while deciding this case. 26. From the passage quoted from these decisions of the Kerala High Court, it would be seen that the Kerala Act is applicable only to joint Hindu families permanently residing or domiciled in the State of Kerala. This is also clear from section 1(2) of Act 30 of 1975 which reads as follows : "It extends to the whole of the State of Kerala." Similarly, section 7(2) of the said Act which is a repealing section reads as follows : "The Acts mention ..... X X X X Extracts X X X X X X X X Extracts X X X X
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