TMI Blog1945 (1) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court of Wards) determines and pays, under the Courts of Wards Act, allowances of the ward and his family and dependants for their maintenance-this discretion in giving the allowances being a matter which no Court might question. The amount in issue is such a separate allowance for the maintenance of the mother of the ward, paid by the Court of Wards periodically and regularly. It passes on receipt by the mother, under her absolute control and she is under no obligation to the Court of Wards or anybody to render an account of how she spends it. The Appellate Assistant Commissioner was of the view that the allowance was liable to be taxed, but the Appellate Tribunal held that it was exempt from taxation under Section 14(1) of the Income-tax Act. The Commissioner of Income-tax being dissatisfied with the decision of the Tribunal moved the Tribunal to refer the question of law formulated above, and hence this reference. Section 14(1) of the Indian Income-tax Act in force at the time of this assessment ran as follows:- The tax shall not be payable by an assessee in respect of any sum which he receives as a member of a Hindu undivided family . Mr. Dutt, the learned S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they have a right till they exercise their right to divide, to be maintained out of the property which is common to them, who are excluded from the management, and to the head of the family who is invested with the management. As it is expressed by the late Mr. Mayne in his work: Those who would be entitled to share in the bulk of the property are entitled to have all their necessary expenses paid out of its income . It follows that the right to maintenance, so far as founded on or inseparable from the right of coparcenary begins where coparcenary begins and ceases where coparcenary ceases . Their Lordships will now revert to the position of an impartible zamindari as it has been fixed by the decisions before referred to. An impartible zamindari is the creature of custom, and it is of its essence that no coparcenary exists. This being so, the basis of the claim is gone, inasmuch as it is founded on the consideration that the plaintiff is a person who, if the zamindari were not impartible, would be entitled as of right to maintenance. There is no claim based on personal relationship. These observations along with the decisions in Sartaj Kuari v. Deoraj Kuari [1888] I.L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he following observations with reference to the right of the junior members of a family to be maintained out of the impartible estate:- One result is at length clearly shown to be that there is now no reason why the earlier judgments of the Board should not be followed, such as, for instance, the Challapalli case [1900] 27 I.A. 151 which regarded their right to maintenance, however limited, out of an impartible estate as being based upon the joint ownership of the junior members of the family, with the result that these members holding zamindari lands for maintenance could still be considered as joint in estate with the zamindari in possession . The last observation has been the subject of considerable comment and discussion but the fact remains that the decision in Collector of Gorakhpur v. Ram Sundar Mal [1934] 61 I.A. 286 reiterates and re-emphasises the principle that an impartible estate is ordinarily-though in a limited sense-joint family property. This view derives further support from the following observations made in Shibaprasad Singh v. Prayag Kumari Debe [1932] I.L.R. 59 Cal. 1899 at p. 1413 : Impartibility is essentially a creature of custom. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t an ancestral impartible estate can be regarded as a joint family property and (2) whether the income from such an estate is the income of the holder of the estate or of the entire family. Apart from the cases to which reference has been made the most direct answer to both these questions is to be found in Commissioner of Income-tax, Punjab, North West Frontier and Delhi Provinces, Lahore v. Dewan Bahadur Dewan Krishna Kishor [1941] 9 I.T.R. 695 ; 68 I.A. 155. , which was decided by the Privy Council in 1941. In this case it was held (1) that as regards house property for the purpose of Section 9 of the Income-tax Act, 1922, the income of an impartible estate to which the assessee has succeeded by the rule of primogeniture is chargeable in his hands as that of a Hindu undivided family and not as that of an individual in as much as under the Hindu law the estate is owned by the joint family; and (2) that for the purpose of Sections 8 and 12 of the Act the income of such an estate is chargeable in the hands of the assessee as that of an individual and not as that of a Hindu undivided family, as such income is not the income of the undivided family but is the income of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ember of the joint family and if she receives maintenance out of the joint family property in the hands of her son, it is difficult to say that she does not receive it as a member of the Hindu undivided family as required by Section 14(1). This view is supported by Commissioner of Income-tax, C.P. and U.P. v. Rani Rudh Kumari [1940] 8 I.T.R. 607. In that case a Taluqdar who had no male issue bequeathed his entire estate by will to his junior Rani. On his death the estate was taken up by the Court of Wards and the Rani was given a monthly allowance of ₹ 3,500. After some years the Rani herself made a will bequeathing the entire estate to the assessee's son who was the Rani's daughter's son's son, and directing that the monthly allowance of ₹ 3,500 should after her death be paid to the assessee, that is to say, the mother of the holder of the estate. By a subsequent arrangement the assessee was paid only ₹ 2,500 per month by the Court of Wards. It was held that the maintenance allowance received by her was exempt from taxation under Section 14(1) because it was received by her as a member of the Hindu undivided family. The learned Judge who deliv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ijayananda Gajapatiraj Kumar of Vizianagaram v. Commissioner of Income-tax [1934] I.L.R. 56 All. 1009; 2 I.T.R. 186 in which the learned Judges observed:- If the sum be considered to be in the nature of a gift, pure and simple, by the assessee's father and brother, it cannot be characterised as income received by a member of a Hindu undivided family as such... It seems to us that if the assessee was, by custom applicable to the Vizianagaram estate, entitled to be maintained with the revenue of the estate and if the allowance fixed for him by his father and brother is in satisfaction of his right to be so maintained, he should be considered to have received it as member of a Hindu undivided family. In my opinion the test laid down in this passage is the true test which should be applied to this case. The assessee in the present case did not receive the maintenance as a gift pure and simple. It is said that her right to maintenance is not based on custom. But if under the law the assessee was entitled to be maintained with the revenue of the estate and if the allowance fixed for her was in satisfaction of the right to be so maintained, then she must be deemed to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintenance is based not upon custom but upon law. These distinctions, however, do not affect the principle which is applicable to this case. In Raj Kumar Rananjaya Singh v. Commissioner of Income-tax, U.P. C.P. [1944] 12 I.T.R. 159 it was held that the maintenance allowance received by an assessee (who was the son of a taluqdar of Oudh) from his father out of the income of the taluqdari estate was not exempt from taxation under Section 14(1) of the Income-tax Act. But the learned Judge who decided the case definitely held that the taluqdari estate in question was not in any sense of the word joint family property. Again, in Ambika Prasad Singh v. Commissioner of Income-tax, Bihar and Orissa [1952] 2 I.T.C. 92 , annual allowance which was received by a father from his son was held not to be exempt from taxation under Section 14(1). In this case, however, the assessee used to receive an annual allowance from his son out of the property inherited by the latter from his maternal grandfather which was therefore not joint family property. In this case as well as in a number of other cases it has been pointed out that the principle underlying Section 14(1) is that the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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