TMI Blog1979 (6) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... tatus of HUF and it was not includible in his individual hands because this property originally belonged to the assessee's father consequent to a partition between the assessee's father Shri Subramania Mudaliar and his sons, including the assessee and, therefore, it was joint family property, the income from which was includible only in the hands of the assessee's HUF and not in his individual hands. The ITO did not agree with this contention because he found that according to the terms of the settlement deed dt. 5th Feb., 1954, executed by the father of the assessee in favour of the assessee's mother and two sisters, the mother had life interest in the properties and after her death the properties were to pass on to her three sons and thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent against the AAC's order and the cross objection by the assessee in support of the AAC's order. 4. The arguments of the Departmental Representative before me were that though the deceased mother had a life interest in the property, nevertheless, she also had disposing powers which is an important factor to show that she became the absolute owner of the property and she could have willed away the property to anyone and in such a state of things, the property ceased to be ancestral property and therefore, when the heirs inherited such a property, it became individual property in the hands of each of the heirs. 5. The assessee's counsel, on the other hand, contended that the AAC had rightly approached the issue in the light of the Hindu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. For answering this question, it is necessary to go to the settlement deed from which only the intention of the settlor has to be gathered. It is not disputed that the properties have to be divided among the respective three sons and their respective heirs assessment equally in three shares as such distribution arises from the settlement deed. It is clear from the settlement deed that this intention was that after the death of his wife the properties should go to his three sons and their respective heirs. Therefore, the sons and their respective heirs were to get the property only through the settlement deed. Further, if the settlor wanted that the properties, in case they remained after his wife's death, should go firstly to the respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to not only the respective sons but also their heirs. 7. Further, in my opinion, though it could be said that the properties have shed their character of being ancestral upon their having been settled on a female Hindu, with disposing power, the shedding of this character is only transitional because the settlement deed stipulates that '' if she does not sell or dispose of the said property during her life time then the said property is to be divided among the three sons and their heirs equally in three shares.''. If the lady had given this property to the assessee during her life time, it could perhaps be said that it was a different case. Since the assessee got this property only after the death of his mother, in terms of the settlemen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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