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TMI Blog1967 (8) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... see should be deemed to have been treated as an association of persons and that such a unit was not chargeable to tax under the Wealth-tax Act, (2) that the assessee being a member of a Jain family could not be treated as a Hindu undivided family, (3) that even if the assessee be treated as a Hindu undivided family the imposition of wealth-tax on a Hindu undivided family was ultra vires the Constitution. The Appellate Assistant Commissioner negatived all the three contentions with the following observations : " As regards the objection regarding the description of the assessee, there is no substance in the objection. Only for the sake of conciseness the assessee has been described as Sm. Champa Kumari Singhi Ors. Sri Bhandari's objection is that the names of the other members of the Hindu undivided family should have been included. This is purely a matter of convenience. The status has been correctly described in the D. N. itself as Hindu undivided family. Therefore, there is no force in this objection of Sri Bhandari. The contention that the word Hindu undivided family does not include a Jain family is also not correct. It has been held that the Hindu law applies to Jain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch, even if such tax may be levied on an individual or individuals separately, a Hindu undivided family cannot be charged to wealth-tax as a unit comprising of several individuals ; (iii) that the assessee was not a Hindu family but a Jain family and since units chargeable to wealth-tax under section 3 of the Wealth-tax Act, 1957, were either individual or Hindu undivided family or company, none of the units covered the case of the assessee. The Tribunal allowed the appeal preferred by the assessee with the following observations : " Admittedly, the department has assessed the assessee in the status of a Hindu undivided family. When the learned representative for the assessee reiterated before us the ground taken before the Appellate Assistant Commissioner, that the assessee was not a Hindu but a Jain, we asked for an affidavit and/or other evidence, if any, to show that the assessee was a Jain. Compliance has been made and we accept the fact that the assessee is a Jain and forms a Jain undivided family. The question then arises, whether the term Hindu undivided family mentioned in section 3 of the Wealth-tax Act encompasses a Jain undivided family.... Referring to Mulla's H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided family or joint family governed under the Mitakshara school of Hindu law was beyond the legislative competence of Parliament and ultra vires the Constitution of India ? (3) Whether the Wealth-tax Act in so far as it purports to levy wealth-tax on Hindu undivided families is void and inoperative, as it offends article 14 of the Constitution of India ? " Now section 3 of the Wealth-tax Act, as it stood at the material time, used to read : " Subject to the other provisions contained in this Act, there shall be charged for every financial year commencing on and from the 1st day of April, 1957, a tax (hereinafter referred to as wealth-tax) in respect of the net wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in the Schedule. " It was not disputed before us that the assessee forms a " Jain undivided family ". If a Jain undivided family is not the same thing as a Hindu undivided family, the assessee family does not fall to be taxed as a Hindu undivided family under section 3 of the Wealth-tax Act. Mr. B. Pal, learned counsel for the revenue, wanted to establish that Jains were Hindu dissenters. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law it was. In the same way it came to be known that there were religious bodies in India which had, at various periods and under various circumstances, developed out of, or split off from, the Hindu system, but whose members have nevertheless continued to live under Hindu law. Of these the Jains and the Sikhs are conspicuous examples. Using his first proposition as a spring-board, Mr. Pal further argued that the Jains, although dissenting from Hindu tenets of religion, continue to live as Hindu joint families, whenever they form a joint family, and do not constitute a different kind of joint family. In support of the second proposition, he relied upon the facts of the case in Lala Gulab Chand v. Lala Mannilal, in which a Jain family admittedly continued the family business as a joint Hindu family business after the death of the ancestor. Historically, Mr. Pal may be right in his contention that the Jains were originally Hindus but later on dissented from Hindu religious belief and became renegades. This is also the view expressed by the Judicial Committee in Sheo Singh Rai v. Dakho and in Sheokuarbai v. Jeoraj and also by the Madras High Court in Gateppa v. Eramma. Mr. Pal is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elastic. Its theology is marked by eclecticism and tolerance and almost unlimited freedom of private worship. But, nevertheless, Hinduism does not include in its fold Hindu converts to Christianity and Mohamedanism and also dissenters from Hinduism, who formed themselves into distinct communities or sects, with peculiar religion and usages, so different from the principles of the Shastras that they cannot but be regarded as being outside Hinduism. So far as native Christians are concerned there is a direct decision on the point by the Judicial Committee, namely, in Abraham v. Abraham in which the following passage occurs : " ........ upon the conversion of a Hindoo to Christianity the Hindoo law ceases to have any continuing obligatory force upon the convert. He may renounce the old law by which he was bound, as he has renounced his old religion, or, if he thinks fit, he may abide by the old law notwithstanding he has renounced his old religion ......... The profession of Christianity releases the convert from the trammels of the Hindu law, but it does not of necessity involve any change of the rights or relations of the convert in matters with which Christianity has no concern, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' Hindu ' in any portion of this Act shall be construed as if it included a person who, though not a Hindu by religion, is nevertheless a person to whom this Act applies by virtue of the provisions contained in this section. It is to be noticed from the above provision, that Jainism is not even treated as a form or a development of Hinduism. Jains have been included within the applicability of the Acts, hereinbefore mentioned, irrespective of the fact that they are not Hindus properly speaking. The Wealth-tax Act does not adopt the above field of the applicability of the law, and, therefore, the width of the applicability of the Acts, mentioned above, should not be imported in the Wealth-tax Act. We have thus to proceed on the basis that Jains are non-Hindus, who are generally governed by the Hindu law. Now, can a non-Hindu joint family be treated as a Hindu joint family ? This question came up for consideration before the Mysore High Court in the case of P. F. Pinto v. Commissioner of Wealth-tax. In that case, the ancestors of the assessee, an Indian Christian professing Roman Catholic faith, were originally Hindus who were later on converted to Christianity. In respect of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the decision of the Supreme Court in Banarsi Dass v. Wealth-tax Officer. Since the assessee did not form a Hindu undivided family but a Jain undivided family, the taxation on the assessee as a Hindu undivided family was not proper and legal. In the view that we take, we answer question No. 1 in the affirmative and in favour of the assessee. Questions Nos. 2 and 3 were not pressed before us for answer. This was so because in the case of K. S. Venkataraman Co. (P.) Ltd. v. State of Madras the Supreme Court observed : " As the Tribunal is a creature of the statute, it can only decide dispute between the assessee and the Commissioner in terms of the provisions of the Act. The question of ultra vires is foreign to the scope of its jurisdiction. If an assessee raises such a question the Tribunal can only reject it on the ground that it has no jurisdiction to entertain the said objection or to decide on it. As no such question can be raised or can arise on the Tribunal's order the High Court cannot possibly give any decision on the question of the ultra vires of a provision. At the most the only question that it may be called upon to decide is whether the Tribunal has jurisdi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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