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TMI Blog1976 (12) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ty, Jagannathji, by the State under the Indian Income-tax Act, 1922, beyond the admitted point. To appreciate the exigibility issue, we have to flash back to 19th Century Bengal and the then prevailing societal ethos of affluent Hindu piety, and we find ourselves in the spiritual-legal company of Raja Rajendra Mullick, at once holy and wealthy, who, in advancing years, executed a comprehensive will to promote his cherished godly wishes and to provide for his secularly dear cause and near relatives. The construction of this testamentary complex of dispositions and the location of its destination are the principal exercises in these appeals. Raja Rajendra Mullick Bahadur of Calcutta executed his last will and testament on February 21, 1887. While the author of the will was a Bengali Brahmin (?) of the last century, the draftsman of the document was John Hart, an English solicitor. While the author's wishes are usually transmitted into the deed by the draftsman, the diction and accent are flavoured by the draftsman's ink. So it happens that this will represents pious Bengali wishes and dispositions--but draped in an English solicitor's legalese. The court's function in such an ambi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be disbursed for meeting those paramount claims and charged for those destined uses ? Or could it be the true meaning of the clauses that the whole income was to be derived by the deity but later to be applied by the human agencies representing Him for fulfilling objects, secular and sacred ? A skeletal picture of the complex of provisions of the will has to be projected now for a better understanding of the pros and cons of the controversy. The will opens with the words : ' I hereby dedicate and make debutter my Thakoorbaree' and mentions a mansion which is to be the abode of his God. 'I hereby give, dedicate and make debutter all the jewels... heretofore used, for the worship of the Thakoors ...' is another recital whereby valuables are dedicated. These are for direct use and both the Lord's mansion and the Lord's adornments yield great spiritual bliss but no secular income. Prima facie, the language is unmistakable and a full dedication and, argues Shri Sharma for the revenue, the creation of absolute debutter is an unchallengeable inference. Equally indisputable is the character of the last set of bequests to his sons (save one who has been disinherited) and widows of deceas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory of this tax entanglement began nearly two decades ago with the Income-tax Officer issuing notices and the assessee-deity responding with " nil " returns under section 22(2) of the Indian Income-tax Act, 1922, for the assessment years 1956-57 and 1957-58. A portion, however, was, by legitimate concession of the income-tax department, carved out of the total income as non-taxable. According to the High Court--See [1971] 81 ITR 353, 357 (Cal) : When the proceedings for the assessment year 1955-56 were pending before the Income-tax Officer, the assessee had filed an application under article 226 of the Constitution of India and had obtained an interim stay against the said proceedings. It appears that on the 9th October, 1961, in terms of the settlement arrived at between the income-tax department and the assessee the interim stay of proceedings was vacated. It was recorded in the said order that part of the income of the assessee which would be proved before the income-tax authorities to have been applied in connection with, (a) feeding of the poor, (b) subscription to other charities enuring for the benefit of the public would be exempted under section 4(3)(i) of the Indian In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Act, 1922, and computed income from property at Rs. 1,94,377 and income from other sources at Rs. 97,248 making a total of Rs. 2,91,625. From the above he deducted the amounts spent on charitable objects such as feeding of the poor, maintenance of art gallery and menagerie for birds and non-carnivorous animals. A sum of Rs. 1,32,023 was subjected to tax for the assessment year 1956-57. The Income-tax Officer followed the same principle for the assessment year 1957-58 and determined the assessable income at Rs. 1,06,067. The assessee preferred appeals before the Appellate Assistant Commissioner, who passed a consolidated order on November 25, 1963, dismissing the assessee's appeals on all the grounds. On appeal to the Tribunal, a full legal debate followed and, while the revenue won substantially, some items more were held exempt on the holding that the direction contained in the will for the expenditure on the performance of sraddha and other ceremonies for the spiritual benefit of the testator and his ancestors must also be held to be obligations created by the testator which the trustees or the shebaits were obliged to discharge before applying the income for the ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aritable purposes were diverted by an overriding title and was accordingly to be excluded from the total income of the Deity ? " (Questions referred by the Commissioner of Income-tax) The High Court, on a meticulous consideration of the entire will, decided against the revenue on the spinal issue and took the view that--See [1971] 81 ITR 353, 373, 374 (Cal) : " Reading the will as a whole we are of the opinion that the entire beneficial interest in the properties did not vest in the assessee-deity. The assessee deity was not the owner of the properties. Therefore, the only income which could be subjected to Income-tax in the hands of the assessee would be the beneficial interest of the said deity under the will, which would be expenses incurred for the seva puja of the deity and for the various religious ceremonies connected with the said deity and the value of the residence of the deity in the temple." The back of the State's contention was thus broken but, even though vanquished, by special leave it sought to agitate in appeal the case that the testator had created an absolute debutter of the whole estate, and not a trust with estate vested in the trustees, that the dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to push aside the English hand to reach at the Indian heart. The principles governing the situation are those which rulings of courts, imbibing the Indian ethos, appreciating the Hindu sacred sentiments and applying the law of religious and charitable trusts gathered from ancient texts, have crystallised into an informal code. The passage of decades after the enactment of the Constitution has not succeeded in persuading Parliament into legislative action for making a secular code except to some limited extent governing the subject of Indian charitable trusts. And this unnoticed parliamentary procrastination has compelled the courts to dive into hoary books and vintage case-law to ascertain the current law. We will, therefore, navigate, with this ancient mariner's compass, although we have the advantage of an authoritative work in B. K. Mukherjea on Hindu Law of Religious and Charitable Trusts, relied on by counsel on both sides. Two paramount background considerations of assistance to decipher the intention of the testator, which have appealed to us, may be mentioned first. We are construing the will of a pious Hindu aristocrat whose faith in ritual performances was more than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the land was dedicated and is inalienable." Though inconclusive, it carries weight in the light of what we may call the mission of the disposition which is inspired by devotion to " my Thakoor " and animated by a general religious fulfilment. It must be remembered that the donor was not tied down by bigotry to performance of pujas, important though they were. A more cosmic and liberal view of Hinduism informed his soul and so in his declaration of dedication to Sree Jagannathjee he addressed to the managers many directions of a broadly religious and charitable character. His injunction to feed the poor was Narayana seva, for worship of God through service of man in a land where the divinity in daridra Narayana is conceptually common place and, while it is overtly secular, its motive springs from spiritual sources. It is religion to love the poor. Likewise, his insistence on the aviary and the menagerie and throwing open both to the people to see and delight is not a mundane mania but has deeper religious roots. Hinduism worships all creation : (Peace be unto all bipeds and even so to all quadrupeds). Indeed, the love of sub-human brethren is high religion. For " H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re strongly suggestive of a non-debutter character, especially because the cost of the pujas makes but a small bite on the total income. He reinforces the submission by many other points which may be mentioned at this stage. He states that the donor, if he meant a straight-forward case of debutter, would have confined himself to the expression "shebaits" but there was a sedulous combination of "shebaits" and/or "trustees" and there was also reference to trusts in some places. Provision for the heirs, for the residence of the shebaitee's families, the horse carriages and the like also do not smack of debutter. A specification of the minimum age of 18 to become shebaits and trustees also savours of trusteeship rather than shebaitship. Appointment of a board of trustees on shebaits failing in succession throws clear light on the creation of a trust in the English sense rather than a debutter in the Hindu sense. Again, shebaitship is property and if what is created is only shebaitship, not trusteeship, how can the testator exclude females, insist on 18 years of age and prescribe a course of succession not quite consistent with Hindu law ? Does this not also point towards trusteeship an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applied for the worship of the idol and repairs of the temple, and the other half was to go for the upkeep of the managers. Their Lordships of the judicial Committee in holding the gift as a valid debutter observed as follows : ' The deed ought to be read just as it appears, and there is no reason, why it should not be so construed as meaning simply what the language says, a gift for the maintenance of the idol and the temple, under which the idol is to take the property, and, for the rest, the family are to be the administrators and managers, and to be remunerated with half the income of the property. If the income of the property had been large, a question might have been raised, in the circumstances, as throwing some doubt upon the integrity of the settlor's intention, but, as the entire income is only 800 rupees a year, it is obvious that the payment to these ladies is of the most trifling kind and certainly not an amount which one would expect in a case of this kind.' Following this decision it was held by the Calcutta High Court in Chandi Charan Das v. Dulal Paik [1926] 30 CWN 930 ; AIR 1926 Cal 1083 that a provision for remuneration of the shebaits with half of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the settlor intended that his title should be completely extinguished and transferred to the trust, that in ascertaining that intention regard must be had to the terms of the document as a whole and that the use of the word 'trust', though of some help in determining such intention, was not decisive of the matter. It sometimes happens that the settlor merely provides for the performance of certain religious services or charities from out of the income of properties specified, and the question arises whether in such cases the specified properties themselves form the subject-matter of dedication. Where the entire income from the properties or a substantial portion thereof is directed to be applied, or is required for such purposes, then the property itself must be held to have been absolutely dedicated for those purposes. Where, however, after applying the income for the purposes specified, there still remains a substantial portion thereof undisposed of, then the dedication must be held to be partial and the properties will continue to be held in private ownership, subject to a charge in favour of the charities mentioned.". Mr. Sen cited several decisions which are more appropr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ject and appraisal in the light of the then conditions, sentiments and motivations of the author, we are inclined to the view that Raja Mullick, the maker of the will, dedicated as debutter to his Maker and Thakoor the entire estate, saddling the human agents or shebaits with duty to apply the income for godly and near-godly uses and for reward of the shebaits and for their happy living. Of course, he had horses and carriages and other items to make life enjoyable. Naturally, his behest covered the obligation to keep these costly things in good condition and regular use. The impact on the mind, if one reads the provisions reclining in a chair and lapsing into the mood of the maker of the will, is that he gave all he had to his Thakoor, as he unminicingly said, and thus dedicated to create an absolute debutter. The various directions are mostly either religious or philanthropic but not so remote as to be incongruous with dedication to an idol or creation of a debutter. The quantum of expenditure on the various items is not so decisive of the character of the debutter as absolute or partial as the accent on and subjective importance of the purposes, in the setting of the totality of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch cases some portion of the beneficial interest may be construed as undisposed of and cannot but vest as secular property in the heirs of the founder. There are cases again where although the document purports, on the face of it, to be an out and out dedication of the entire property to the deity, yet a scrutiny of the actual provisions reveals the fact that the donor did not intend to give the entire interest to the deity, but reserved some portion of the property or its profits for the benefit of his family relations. In all such cases the debutter is partial and incomplete and the dedicated property does not vest in the deity as a juridical person. It remains with the grantees or secular heirs of the founder subject to a trust or charge for the religious uses. The earliest pronouncement of the law on the subject is to be found in the decision of the Judicial Committee in Sonatun Bysack v. Smt. Juggutsoondree Dossee [1859] 8 MIA 66 (PC), which was followed and applied in the subsequent case of Ashutosh Dull v. Doorga Churn Chatterjee [1879] LR 6 IA 182 ; ILR 5 Cal 438 (PC)." Sonatun Bysack [1859] 8 MIA 66, 85 (PC), referred to by the learned author, dealt with a case where a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his deity were the primary beneficiaries and on taking note of the language used, if the vesting is in the idol an absolute debutter can be spelt out. So considered, if the grant is to the heirs with a charge on the income for the performance of pujas, the opposite inference is inevitable. Before us, there is no dispute between the heirs and the idol. The point mooted is about the creation of an English trust, an unconventional legal step where the dedication is to a deity. On a full study of the will as a whole, we think that this benignant Bengalee's testament, draped though in Victorian verbal haberdashery, had, on legal auscultation, the Indian heartbeats of Hindu religious culture, and so scanned, his will intended vesting the properties in absolute debutter. The idol was, therefore, the legal owner of the whole and liable to be assessed as such. The respondent, however, has a second string to his bow. Assuming an absolute debutter, there is still many a slip between the lip and the cup, between the income and exigibility to tax. For, while, ordinarily, income accrues in the hands of the owner of property and is taxable as such, it is quite on the cards that in view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut of the income of his property on the occasion of his ' Addya Shradh ' for expenses in connection therewith to the person entitled to perform the Shradh. He also directed his executors to pay out of the income of his property the costs of taking out probate of his will. After conferring out of income benefits on the second wife and his daughter and (out of the estate) benefits on the sons, if any, of his daughter, and after providing for the payment out of income 'gradually' of diverse sums to some persons, and certain annuities to others, he bequeathed all his remaining property (in the events which happened) to a son taken in adoption after his death by his wife, viz., one Ajit Kumar Ghosh, who is still a minor...... The payment of the Shradh expenses and the costs of probate were payments made out of the income of the estate coming to the hands of the appellants as executors, and in pursuance of an obligation imposed by their testator. It is not a case like the case of Raja Bejoy Singh Dudhuria v. Commissioner of Income-tax [1933] 1 ITR 135 (PC) in which a portion of income was by an overriding title diverted from the person who would otherwise have received it. It is simpl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct that the shebaits and trustees shall out of the debutter funds maintain and keep a sufficient number of carriages and horses for their use and comfort and that of their families and after providing for the purposes aforesaid out of the debutter income I direct the shebaits and trustees to pay to each of the shebaits for the time being who shall actually take part in the performance of the duties of the shebaits and the execution of the trusts of this fund as and by way of remuneration for their services the sum of rupees five hundred a month......" " I direct that the widows of my three deceased sons, Greendro, Soorendro and Jogendra, who assist in the work of preparing articles of offerings to the Thakoors and for the feeding and distribution to the poor and all the widows of shebaits hereby appointed and future shebaits who shall in like manner assist in the said work shall be fed and clothed and maintained and shall receive a remuneration of the sum of rupees fifty each a month from the income of the debutter fund...... " So the shebaits first get the income and then apply it in conformity with the directives given in the will. The rulings relied on by both sides do not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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