TMI Blog1966 (10) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... of her son, Sriramulu, constituted a transaction of gift under section 2(xii) of the Gift-tax Act liable for assessment ? " The assessee is the wife of one Valluru Pullayya, Mandapeta. They had three sons by name Valluru Sriramulu, Valluru Narasimharao and Valluru Sathiraju. The father and the three sons constituted the joint family. on April 9. 1953, the father partitioned the properties between himself and his three sons and each of whom got into possession of their respective shares. On August 30, 1954, Valluru Sriramulu, the eldest of the three sons executed a deed of gift whereby he transferred the entire properties obtained on partition to his mother, the assessee. It may be stated and it is not disputed that at the time when the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ended that at the time when Sriramulu conveyed the property by way of gift to his mother in 1954, he had only a daughter and, since the properties gifted belonged to the Hindu joint family, Sriramulu was not competent to gift away the whole of those properties, and at the most the gift could be valid only to the extent of his share. The Gift-tax Officer rejected this claim of the assessee and held that the gift was valid and consequently assessed her to tax. The Appellate Assistant Commissioner also negatived the contentions of the assessee, and, having looked into the contents of the two gift deeds, he found that there was nothing therein to support the version of the assessee. Before the Tribunal, the assessee filed the plaint and the w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or an adjournment to produce the agreement ; as such, we cannot say that the Tribunal has failed to give him an opportunity to file the relevant evidence. Notwithstanding these defects, we think that the contention of the learned advocate that the gift is invalid must be sustained. Apart from the question that the plaint alleges that the gift was only a nominal one, in the circumstances as set out therein, namely, that Sriramulu was given to ways of vice and wasteful habits and was dissipating the property as a consequence of which the elders persuaded him to transfer the property nominally in the name of his mother, which allegation though denied to the extent of his leading a life of vice and wasteful habits, admitted that the transfer it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of deceased male members, and the Income-tax Act does not indicate that a Hindu undivided family as an assessable entity must consist of at least two male members. It was further observed that under section 3 of the Income-tax Act not a Hindu coparcenary but a Hindu undivided family is one of the assessable entities. A Hindu joint family consists of all persons lineally descended from a common ancestor, and includes their wives and unmarried daughters. A Hindu coparcenary is a much narrower body than the joint family : it includes only those persons who acquire by birth an interest in the joint or coparcenary property, these being the sons, grandsons, and great-grandsons of the holder of the joint property for the time being. As we have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ft to an outsider of a joint family property. The scope of the limitations on that power has been fairly well-settled by the decisions interpreting the relevant texts of Hindu law. The decisions of Hindu law sanctioned gifts to strangers by a manager of a joint Hindu family of a small extent of property for pious purposes. But no authority went so far, and none has been placed before us, to sustain such a gift to a stranger, however much the donor was beholden to him on the ground that it was made out of charity. It must be remembered that the manager has no absolute power of disposal over joint Hindu family property. The Hindu law permits him to do so only within strict limits. We cannot extend the scope of the power on the basis of the wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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