1978 (5) TMI 16 - HC - Wealth-tax

Summary

Issues Involved:
1. Whether the sum of Rs. 18,41,952 could be assessed in the hands of the assessee as an individual.
2. Whether the properties referred to in the Lal Mohar and the two Khadga Nishanas were self-acquired or belonged to the Hindu Undivided Family (HUF).
3. The legal effect of the Lal Mohar and the two Khadga Nishanas under Nepalese law.
4. The validity of the expert evidence on Nepalese law.

Issue-wise Detailed Analysis:

1. Whether the sum of Rs. 18,41,952 could be assessed in the hands of the assessee as an individual:
The Tribunal concluded that the sum of Rs. 18,41,952 represented joint family assets and not the personal wealth of the assessee. This conclusion was based on the evidence presented, including the Lal Mohar and the opinion of the expert on Nepalese law. The Tribunal held that the properties were part of the Hindu Undivided Family (HUF) and should not be included in the individual assessment of the assessee for the relevant assessment year.

2. Whether the properties referred to in the Lal Mohar and the two Khadga Nishanas were self-acquired or belonged to the Hindu Undivided Family (HUF):
The Tribunal found that the properties in question were part of the HUF. The Lal Mohar granted the assessee the power to distribute the assets among the coparceners at his discretion but did not make him the absolute owner of the properties. The properties were, therefore, considered to belong to the HUF, and the assessee did not have the authority to alienate them as personal assets.

3. The legal effect of the Lal Mohar and the two Khadga Nishanas under Nepalese law:
The expert on Nepalese law, Neer Kumar Kshetry, clarified that the Lal Mohar provided the Prime Minister with the privilege to distribute family properties among coparceners unequally, but it did not deprive the coparceners of their rights to the properties. The Khadga Nishanas were instruments of partition executed by the assessee, which distributed the family properties among his wife, son, daughters, and grandchildren. The Tribunal accepted the expert's opinion and held that the properties remained joint family assets.

4. The validity of the expert evidence on Nepalese law:
The Tribunal accepted the expert evidence provided by Neer Kumar Kshetry, who explained the characteristics of Nepalese personal law and its resemblance to the Mitakshara School of Hindu law. The Tribunal noted that the revenue did not challenge the expert's opinion or present any contrary evidence. The Tribunal also found no merit in the revenue's contention that the expert was not properly examined or cross-examined, as there was no record of any such request being made or denied.

Conclusion:
The Tribunal's findings were based on the evidence presented, including the Lal Mohar, the two Khadga Nishanas, and the expert opinion on Nepalese law. The Tribunal held that the properties were part of the HUF and should not be assessed as the personal wealth of the assessee. The High Court upheld the Tribunal's decision, answering the referred question in the negative and in favor of the assessee. There was no order as to costs.