TMI Blog1929 (8) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner of Income Tax, Bengal, reviewed the assessment under Section 33, Income Tax Act, and, after notice to the Raja, and after hearing him, came to the conclusion that the deduction of ₹ 9,900 which had been allowed should be disallowed and directed that he be assessed on a total income of ₹ 1,21,905. The occasion for this review of the original assessment was an objection by Sreemati Sugankumari Bibi to an assessment made upon her in respect of the maintenance allowance of ₹ 1,100 per month before mentioned. It would appear that the lady lives at Bikanir, but that the Income Tax Officer at Murshidabad purported to assess her through the Raja, as her agent, and had made an assessment upon the monthly sum of ₹ 1,100 on the footing that it was an annuity taxable as salary under Sub-section 1, Section 7 of the Act. The lady very naturally objected that the Raja was not her employer and the Commissioner very properly accepted this contention. Apart from this however the lady maintained that she was not liable to be assessed at all and the Commissioner of Income Tax, in accordance with a contention pressed upon him on behalf of the lady, held that the Raja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her with certain arrears of maintenance. The Raja has been regularly paying the monthly allowance as decreed and, in the year of account with which we are concerned, he paid in all for this purpose Ra. 13,200. It is agreed that ₹ 9,900 represents the same proportion of ₹ 13,200, as the assessed income of the Raja bears to his total income, including agricultural income. In these circumstances the Commissioner is of opinion that the Raja and the lady are members of an undivided Hindu family and that the total income of the family is assessable in the hands of the Raja as manager thereof, no deduction being permissible in respect of the maintenance paid to one of the members. Further, and in the alternative, he is of opinion that the maintenance paid to the widow is on the same footing as the maintenance provided by the assessee for his wives and daughters and is a personal expense of the assessee and cannot be held to be a charge upon his estate for the purposes of assessment to income tax. 7. At the hearing before us the learned Advocate-General abandoned the contention which found favour with the two Commissioners of Income Tax, who have dealt with the case, that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rious properties, securities and businesses under a bequest from his father upon the terms that these assets were charged with an annuity for the maintenance of the widow. We are not dealing here with a charge created by the Raja for the payment of debts, which he has voluntarily incurred. The Raja is, by virtue of an exceptional and peculiarly extensive charge, an owner of incumbered property and the question before us requires us to ascertain the law applicable to a case, where the income from property, securities business, etc., is subject to a charge for an annual sum. In the present case, it would doubtless have been open to the Court, had circumstances required it be raise and set apart act of the estate a capital sum to answer the right of the widow to her annual maintenance : see Hemanginee Dassee v. Kumode Chancier Dass [1898] 26 Cal. 441 and in any case should default be made in paying the annual sum, it would be open to the Court in a suit to enforce the charge, to appoint a receiver of the properties and give him directions, if necessary, for sale of a sufficient portion thereof. I do not think, however, that the present question is complicated by the fact that the lady ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case of salaries and interest on securities, the payer being authorized and required to deduct the tax and himself to make payment to Government of what he has deducted. The present case is wholly untouched by any of these previsions. Accordingly, a good many considerations have to be weighed, before it can be decided whether the owner of property or business or securities subject to a charge for an annuity can get any allowance in respect of his liability. Assuming, for the present purpose, and contrary to the contention of Sreemati Sugankumari Bibi, that we are not here dealing with the case of an undivided Hindu family, and assuming further, without deciding, that the lady, although a resident of Bikaner is chargeable under the Act, her case would seem to come within the provisions of Section 19 and tax on her income to be payable by herself direct. No doubt machinery is provided by Sections 40 to 43, whereby the assessment might be made upon a trustee in British India; but even if the Raja can be deemed her agent or trustee, the basis of any such assessment would be that the lady's income was being assessed in effect upon herself. We are solely concerned with the Raja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpossible to make room for a deduction on the ground that he has to pay this annuity out of the profits, Prima facie the destination of profit is irrelevant. 17. Under Section 12, as regards other sources the language employed by the legislature is less precise. The provision for deduction gives a right to the assessee to an allowance for any expenditure (not being in the nature of capital expenditure) incurred solely for the purpose of making or earning, such income, profits or gains, provided that no allowance shall be made on account of any personal expenses of the assessee . 18. This annuity cannot, in my opinion, be regarded as a personal expenditure of the assessee, treating him as an individual, whose property is subject to a charge for this annuity. But the payment does not otherwise come within the exception. It may be said that the income, profits and gain$ mentioned in Sub-section (1) means, when read with Section 3 of the Act income, profits and gains of the individual, namely of the assessee, and that, under this section, a deduction might be made upon the general principle that money payable to the lady is not income of the Raja. It happens that the total in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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