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TMI Blog1976 (4) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... the properties could not belong to the Hindu undivided family and were to be taxed "in the hands of the co-sharers separately." The department took an appeal to the Income-tax Appellate Tribunal, "B" Bench, Calcutta. There was difference of opinion between the Members of the Tribunal, and in accordance with the opinion of the majority of the Members it was ordered that "notwithstanding that there was no unity of ownership amongst members governed by the Dayabhaga school of Hindu law in respect of the family property and each member thereof had indefinite shares in it, such property, until partitioned, was assessable to wealth-tax in the hands of the Hindu undivided family." The Tribunal, however, referred the following question of law to the Calcutta High Court for decision : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that properties possessed jointly by the members governed by the Dayabhaga school of Hindu law were assessable to wealth-tax jointly in the status of a Hindu undivided family ? " The High Court accepted the contention that the question assumed that the property was owned jointly by the members of a Hindu undivid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " The liability to wealth-tax, therefore, arises in respect of the " net wealth " of the assessee, which expression has been defined as follows in section 2(m) : " (m) 'net wealth' means the amount by which the aggregate value computed in accordance with the provisions of this Act of all the assets wherever located, belonging to the assessee on the valuation date, including assets required to be included in his net wealth as on that date under this Act, is in excess of the aggregate value of all the debts owed by the assessee on the valuation date other than,......... " The expression "belong" has been defined as follows in the Oxford English Dictionary:--"To be the property or rightful possession of." So it is the property of a person, or that which is in his possession as of right, which is liable to wealth-tax. In other words, the liability to wealth-tax arises out of ownership of the asset, and not otherwise. Mere possession, or joint possession, unaccompanied by the right to, or ownership of property would therefore not bring the property within the definition of "net wealth" for it would not then be an asset "belonging" to the assessee. The question is whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f "aggregate ownership", while Dayabhaga is known as the school of "fractional ownership". As has been stated in Golapchandra Sarkar Sastri's "Hindu Law" (eighth edition, page 465), while the joint family system prevails in Bengal, "there cannot be a real joint family consisting of father and sons during the father's lifetime inasmuch as joint property which is the essence of the conception of joint family, would be wanting to make them joint." This is why, according to the Bengal school, the sons become tenants-in-common and not joint-tenants in respect of the estate inherited by them from their father. The position of joint family under the Dayabhaga law has been stated as follows in Mayne's Treatise on Hindu Law and Usage (eleventh edition, page 364) : " It follows therefore that under the Dayabhaga law, a father and his sons do not form a joint family in the technical sense having coparcenary property. But as soon as it has made a descent, the brothers or other co-heirs hold their shares in quasi-severalty. Each coparcener has full powers of disposal over his share which is defined and not fluctuating with births and deaths as in the case of a Mistakshara family and his int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled an appeal and contended that the family being governed by the Dayabhaga school, the shares of the coparceners in the property of the deceased were definite and ascertained and the assessment should not have been made in their status as a Hindu undivided family and each member should have been assessed separately upon the value of his share in the inherited property. The Appellate Assistant Commissioner overruled the contention and took the view that even though the shares of the coparceners were definite and ascertained, the income from the property of the family did not belong to the several members in specified shares but continued to belong to the Hindu undivided family as a whole. On further appeal, the Tribunal held that as the coparcener under the Dayabhaga law had a definite share in the property left by the deceased and was legally the owner thereof, he had a defined share and that since the wealth-tax was levied on the basis of ownership, it was proper that the assessment should have been made on the individual coparceners on their respective shares and assessment of the total wealth in the hands of the undivided family would be illegal. The matter was referred to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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