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TMI Blog1966 (11) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... d into a partnership with 2/3rd of the assets of the business known as Murlidhar Mathura Prasad which was, as already indicated, the separate business of Durga Prasad. A partnership was entered into between Jai Devi and and Ram Rakshpal and its terms were incorporated in a deed which was duly registered on 23rd April, 1958. In the assessment year 1959-60, immediately following the death of Durga Prasad, the question arose whether the income from the one-third share which had come to Ram Rakshpal from Durga Prasad should be assessed as part of the income of the Hindu undivided family of Ram Rakshpal Ashok Kumar, the assessee before us, or as the separate property of Ram Rakshpal. The Income-tax Officer assessed it as the income of the Hindu undivided family applying the well recognised principle of Hindu law that the property left by the grandfather in the hands of the father is ancestral property in which the grandson has a right by birth. On an appeal, the Appellate Assistant Commissioner maintained the decision of the Income-tax Officer, but, on a second appeal, the Appellate Tribunal allowed the appeal with regard to the income from the share inherited by Ram Rakshpal from Durga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age, and sapratibandha daya or obstructed heritage. Property in which a person acquires an interest by birth is called unobstructed heritage. It is called unobstructed, because the accrual of the right to it is not obstructed by the existence of the owner. . . Property, the right to which accrues not by birth but on the death of the last owner without leaving male issue, is called obstructed heritage. It is called obstructed, because the accrual of the right to it is obstructed by the existence of the owner." All the cases which have been cited in Mulla's Commentary on Hindu Law in support of the proposition put forward by Mr. Gulati, on behalf of the department, relate to the law as it stood before the Hindu Succession Act, 1956. There is no doubt whatsoever about the position under the Hindu law as it then stood. Mr. Gulati also relied on the following passage from Dr. Derrett's "Introduction to Modern Hindu Law " (paragraph 411, at page 252) : " Since on the death of a father his separate property (or divided share) passes to his sons as ancestral property between them and the sons and grandsons of each of them (the ' male issue ')---a position which persists notwithstanding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operty comes to the father by virtue of the latter's legal right as a son " and then gives the result--- " consequently, it becomes ancestral in his hands "---that there is any question of the property first vesting in the father and then vesting again in the father and the son (i.e. the son and grandson of the deceased). There cannot possibly be a double devolution or a vesting in a son followed by a divesting and a revesting in the son and grandson. Such a proposition would contradict the basic principle of Mitakshara law that the grandson's rights arise at his birth in ancestral property and not subsequently. The grandson's rights, at the death of his grandfather, devolve upon him, under the Mitakshara law, prior to its modification by the statutory law, simultaneously with those of his father. The basic rule of the law of succession, applicable both to Hindus and Muslims, is that the vesting in the successor takes place at the moment of the death of the previous owner. If the intention of the statutory law, as found in section 8 of the Hindu Succession Act, was that the right of a grandson whose father is living should also be recognised at the time of succession to the propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndfather, yet, he has an unequal right in the property of his own father. According to the Mitakshara law, the non-ancestral acquisitions of a father are capable of being disposed of by him untrammelled by any right of his own son. This power of a man over the property acquired by himself or non-ancestral property is deduced from equally clear texts of Hindu law quoted by their Lordships of the Supreme Court. The distinction was important there because the question under consideration before the Supreme Court in that case was whether the father could dispose of non-ancestral property by will and gift to whomsoever he liked. It was held there that the father had such a right. In other words, that was a case in which the rule, that the grandsons vested right by birth in the grandfather's property would operate as a restriction on the powers of the father, did not apply. One of the reasons given in support of this conclusion was that, technically speaking, the term " ancestral property was restricted to property which comes from an ancestor in the male line. This rule was also explained by Sir Shadi Lal in Muhammad Husain Khan v. Babu Kishva Nandan Sahai, where his Lordship observed : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with his father in the property of the grandfather, was to be read into the provisions of the Hindu Succession Act, some arguments of very general character, about the nature of the solution sought by the Hindu Succession Act, were addressed to us. Our attention was drawn, in particular, to the following observations in the Introductory Note on the Hindu Succession Act in Mulla's Commentary (13th edition, pages 762 to 763) on Hindu law : " Probably the best solution would have been to abolish the ancient legal formulae of acquisition of right by birth and devolution by survivorship since the logical way was to assimilate the Mitakshara to the Dayabhaga in this respect. This would also have the merit of equable treatment of the nearest female heirs of a coparcener and of bringing about uniformity in the law in all parts of India. Sentiment in favour of retention of the Mitakshara coparcenary even in an attenuated form seems to have been respected and the rules laid down in section 6 are a compromise having some of the merits and all demerits which attend such adjustive legislation." There seems to be no scope for considerations of a wide and general nature about the objects attem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the devolution of " property " itself of a male Hindu, falling outside the purview of section 6 of the Act upon the death of a male Hindu intestate. If general considerations as to the character of ancient and pre-existing law, as contained in the texts of the Mitakshara, as contrasted with the Hindu law found in the Hindu Succession Act, were to be taken into account one may refer to Sri Henry Maine's Ancient Law, where the evolution of the concept of corporate property as a necessary adjunct of the undying corporate entity of the family is shown to have been replaced by the concept of individual rights in separate property which characterises the modern industrial society. As Sir Henry Maine pointed out, corporate rights in property had been split up and resolved into individual rights over property in the course of social evolution. It is pointed out in John D. Mayne's Treatise on Hindu Law and Usage that, under the law relating to the Mitakshara coparcenary property, there can be no succession to property strictly speaking. As indicated there (11th edition, page 324), the rights of individuals born in an undivided Hindu family are enlarged by deaths and diminished by births. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation excludes this rule of reference." In section 8 of the Act, the right of representation is confined to the grandson through a pre-deceased son and no mention is made of the grandson as an equal heir with the son and rules of exclusion are actually laid down by the Act. The clear effect is that what has been described as unobstructed heritage under the Mitakshara law was converted into an obstructed and not merely " obstructible " heritage by the operation of section 8 of the Act inasmuch as the rights of the son, to the exclusion of the grandson whose father is alive, now obstruct what was technically described as " unobstructed heritage " under the Mitakshara law. If, as we find from the comprehensive provisions of the Hindu Succession Act, the object of the Act was to provide a self-contained code on all matters relating to succession to property of citizens governed by the Act, it is not possible to resist the conclusion that the particular rule relied upon by the learned counsel for the department was superseded by the provisions of the Act, unless the deceased himself had an interest in a Mitakshara coparcenary property. In the latter event only would section 6 of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned in this case. It may be observed that in that event section 6 of the Act would have operated in favour of the son who was joint with Durga Prasad. But, hypothetical positions, which may arise upon the circumstances not present in this case, need not be examined by us at all. The result is that, after considering the provisions of the Indian Succession Act, we conclude that the case of the assets of the business left by Durga Prasad in the hands of Ram Rakshpal would be governed by section 8 of the Act. It may also be mentioned that it was argued, on behalf of the assessee, that there is no finding that the business carried on by Durga Prasad in the name of Murlidhar Mathura Prasad was built up exclusively with the assets Durga Prasad obtained on the partition between him and Ram Rakshpal on October 11, 1948. This question, however, is unimportant in view of the conclusions reached by us on other questions. We may observe that it was open to Ram Rakshpal, as the Tribunal has pointed out, to merge the assets inherited by him from Durga Prasad with those of his own Hindu undivided family. But, so long as he has not done that, the income of his inheritance cannot be assessed as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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