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TMI Blog1984 (2) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... 1974-75, the Tribunal accepted the assessee's claim that the income in his hands as well as the wealth arising from the property inherited in the above manner was liable to be assessed as the income of the HUF of which he is the karta for the assessment years 1971-72 and onwards. The aforesaid orders of the Tribunal were accepted by the department and have, thus, become final. On 23-3-1977, ie., after the department had accepted the abovesaid Tribunal's order, there was a partial partition of the property whereafter the income is shown by the separated members as their income. Similarly, the wealth is also shown by the separated members as their wealth. 2. The dispute has again arisen for the assessment year 1977-78 in regard to income-tax proceedings and for the assessment year 1975-76 in respect of wealth-tax proceedings. The Commissioner (Appeals) has, following the aforesaid Tribunal's orders, accepted the assessee's claim. This is how being aggrieved by the order of the Commissioner (Appeals), the department has come up in appeal. Placing reliance on a number of High Court decisions where a contrary view has been taken, it was submitted on behalf of the revenue that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in force providing for the prevention of fragmentation of agricultural holdings or for the fixation of ceilings or for the devolution of tenancy rights in respect of such holdings. " Clause (a) of sub-section (1) provides that any text, rule or interpretation of Hindu law or any custom or usage as a part of that law in force immediately before the commencement of this Act shall cease to have effect with respect to any matter for which a provision has been made in this Act and clause (b) contains an identical overriding provision as regards any other law, i.e., other than the shastric Hindu law. By necessary implication it means that in respect of matters for which there is no provision in this Act, the old shastric Hindu law will continue to apply. 4. Coming to the facts of the case, it is found that the assessee has inherited the separate property of his father who died intestate under section 8 of the Hindu Succession Act which reads as under : " 8. The property of a male Hindu dying intestate shall devolve according to the provisions of this Chapter :--- (a) firstly, upon the heirs, being the relatives specified in Class I of the Schedule ; (b) secondly, if there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty and that the sons, grandsons and great-grandsons acquire an interest in such a property by birth. We say so as there is not even a suggestion that there is as such any provision in the Hindu Succession Act laying down a contrary proposition. In the circumstances, the property inherited by a male Hindu from his father would be ancestral property qua his sons. In other words, it will become HUF property for the purpose of assessment to income-tax and wealth-tax the moment a son is born to such a male Hindu. 6. It is pertinent to mention that three main arguments have been advanced on behalf of the revenue against this proposition, namely (i) mention of a son only as the heir as distinct from son and his son in the Schedule to section 8 is indicative of the fact that the son inherits absolutely and not along with his son or sons ; (ii) this interpretation, if accepted, will make male heirs inferior to female heirs who inherit the property absolutely ; and (iii) there is no specific provision in the Hindu Succession Act envisaging that such a property constitutes an ancestral property. The third argument is obviously without any force. As stated by us earlier, the Hindu Successio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion contrary to the old shastric Hindu law in this regard. In the circumstances, we are inclined to hold that the character of the property in the hands of the assessee is HUF property as claimed by the assessee. 8. Before concluding, it is desirable to mention that the standing counsel had relied on a decision of the Supreme Court in the case of Giani Ram v. Ramji Lal AIR 1969 SC 1144 and in the case of Gurupad Khandappa Magdum v. Hirabai Khandappa Magdum [1981] 129 ITR 440, (SC). On going through the decision in Giani Ram's case, we find that their Lordships had held in that case that the rights conferred on the female Hindu by section 14(1) of the Hindu Succession Act make a clear departure from the previous law and, as such, the previous law cannot be used for circumventing these rights. However, there is no dispute in the case before us about the principle laid down by the Hon'ble Supreme Court. What has been laid down in the decision in the case of Gurupad Khandappa Magdum is that the purpose of the Hindu Succession Act is to give more rights to Hindu women and that, therefore, such an interpretation should be given as will result in enlargement of the share of the female h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt is not reasonable or a possible view. 11. The Special Bench of the Tribunal at Hyderabad has no doubt preferred to follow the decisions given by the other High Courts in preference to the decision of the Gujarat High Court then available in the case of Harshadlal Manilal. The case before us has its own peculiar facts. In this case, the Tribunal had accepted the assessee's claim that the property was HUF property in income-tax proceedings for the assessment year 1971-72 and in wealth-tax proceedings for the assessment years 1971-72 to 1974-75. The said order of the Tribunal was accepted by the department ; for subsequent years, the department itself has held the property to be HUF. In fact, after the Tribunal's order was accepted, the property has been partitioned amongst the members of the family. Apart from what is stated by us above, the view taken by the Gujarat, the Punjab and Haryana High Courts and subsequently the Allahabad High Court has appealed to us. In this view of the matter, we are inclined to hold that on the peculiar facts of this case, the property and the income therefrom should be treated as belonging to the HUF of the assessee. 12. In the result, the de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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