TMI Blog1989 (1) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... urpose of assessment under the Estate Duty Act. The Mysore Cutchi Memons Act I of 1943 ("the Act" for short), became applicable in the year 1948 after retrocession of the civil area of Bangalore when this law was extended to that area. So far as the assessee is concerned, the law applicable to him is as held in Hajee Abdul Sattar Sait's case [1968] 69 ITR 45 (Mys) and in CED v. Hail Abdul Sattar Sait case [1972] 86 ITR 53 (SC). Indeed, the assessee and his brother being accountable persons under the Estate Duty Act had contended before this court and the Supreme Court that they were governed by rules applicable to the coparcenary property under the Mitakshara school of Hindu law. While examining the scope and effect of the law as contemplated in Cutchi Memons Act, this court in the case of Hajee Abdul Sattar Sait's case [1968] 69 ITR 45, observed as follows (at page 52) : "By virtue of section 3, the position would be that if the assessees before us are right in their case that they are governed by the Hindu law relating to joint family property or coparcenary property involving the doctrine of the right by birth and devolution by survivorship, then both the accountable persons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tant Commissioner in this regard. It held that the expression "inheritance and succession" in that Act was not merely applicable to the separate property of the assessee but also to the ancestral property devolving upon him when he was born in the family and on the death of his father in 1955. Aggrieved by the order of the Tribunal, the assessee sought a reference and the Tribunal has referred the following questions of law for the opinion of this court : "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in rejecting the contention that the applicant is Cutchi Memon governed in matters of property, succession and inheritance by the rules of Hindu law including the rules as to joint family property, its distribution according to the rule of survivorship and the right of a son in it by birth ? 2. Whether Hindu law recognises a clear difference between 'succession and inheritance' on the one hand and 'the rules as to joint family property, its distribution according to the rule of survivorship and right of a son in it by birth' on the other hand ? 3. Whether section 2 of the Mysore Act 1 of 1943 affects the rule as to joint family propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1943. (2) It shall come into force on the first day of July, 1943. 2. Subject to the provisions of section 3, all Cutchi Memons shall, in matters of succession and inheritance, be governed by the Muhammadan law. 3. Nothing in this Act shall affect any right or liability acquired or incurred before its commencement or any legal proceeding or remedy in respect of any such right or liability ; and any such proceeding or remedy may be continued or enforced as if this Act had not been passed. The section that calls for interpretation is section 2. Section 2 is to the effect that in matters of "succession" and "inheritance", Cutchi Memons are governed by the Muhammadan law after the coming into force of the Act except to the extent saved under section 3. The argument developed on behalf of the assessee is that there was dichotomy of views between various High Courts. The Bombay line of decisions held that application of Hindu law is now restricted to cases of succession and inheritance as it would apply in the case of intestate separate Hindus possessed of self-acquired property. The Madras line of decisions held that Cutchi Memons had regulated inheritance and succession acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed both the expressions "succession" and "inheritance", no redundancy can be attributed to such expressions although it has been contended on behalf of the assessee by the rule of noscitur a sociis that the expression "inheritance" must take the same colour as "succession" by reason of its context and association. The proper construction, in our opinion, would be to give a meaning to both expressions "inheritance" and "succession". If "inheritance" and "succession" mean the same, then there was no need for the Legislature to have used the two expressions. Now, let us examine whether the expression "inheritance and succession" could also include in it, the rules of Hindu law of right by birth and survivorship and could be brought within its scope. The expressions "inheritance" and "succession" used in the enactment are not to he understood as restricted to passing of interest in property from the dead to the living but as covering also rights and obligations that exist which are governed by Hindu law. The Bombay line of decisions held that the application of Hindu law is restricted to cases of "succession and inheritance" as it would apply in cases of intestate succession to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment, the learned judges explained the position in law.: '(24) ... In the Hindu law texts, Daya Vibhaga is a part of the law relating to Daya, which has been translated as 'inheritance'. It is, therefore, not unreasonable to hold that rights flowing from the corporate ownership of property, which is involved in the concept of joint family and coparcenary property has been connoted by the expression "inheritance" and "succession" which occur in the earlier Government of India Acts, which we have referred to and in the Lists in Schedule 7, Government of India Act, 1935. The expression "devolution" used in Item 21 of List 11 is really compound of the entries "wills, intestacy and succession" in Entry 7 of List 3.' Mitakshara is a commentary written by Sri Vignaneswara on the Smrithi of Yagnavalkya. Vignaneswara took up the version of Yagnavalkya and appended his gloss to it. In Chapter 1, Schedule 1, pages 1 to 3, Colebroke, who is held to be an authority on this subject, has translated the relevant portion in the following words : "(i) The distribution of Daya is now being propounded by the Yogamoorthi (Yagnavalkya) ; (ii) Here the term 'Daya' signifies that the wealth become ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t v. Dattu, AIR 1987 SC 398, and D. S. Agalawe v. P. M. Agalawe, AIR 1988 SC 845, 849, and sought to contend that a distinction has been made between "survivorship" under the Mitakshara Hindu law and "inheritance" under the same system. While devolution of the property on the member of the joint family entering therein by birth or adoption under the rule of survivorship became effective only on partition, the succession of the same under the rule of "inheritance" by the nearest available heir becomes effective immediately on the death of the last holder when succession opens. Learned counsel also relied upon certain passages in the Principles of the Hindu Law of Inheritance (T. L. R. 1880) and contended that the right in the paternal ancestral estate is acquired by birth, and that there is, in fact, no devolution of property from one owner to another and as each son comes into being, he immediately acquires a right which would, on partition, reduce the shares of the other sons, and which, should he not survive a partition and have issues, his son or grandson would take by substitution, and which, if he dies before that period, would simply lapse. There being no devolution of proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a right or a quality or disease by birth. Therefore, when the Legislature used two expressions "succession" and "inheritance" in the Act, the only meaning that we can give is that inheritance and succession would include the right by birth and the rule of survivorship as applicable to Hindu coparcenary. Even the Legislature has not maintained the strict division between succession and survivorship. For example, while the Hindu Succession Act deals only with succession, in section 6 of the Act, it provides for devolution of interest in coparcenary property and modifies the rule of survivorship in the case of a Hindu dying leaving behind a relation specified in clause I of the Schedule to the Act. So also the said Act gives a testamentary right in relation to the coparcenary interest in the property. Broadly understood, therefore, the expression "inheritance" used in the Act would include the rules of coparcenary right by birth and survivorship. Any other answer would lead to highly anomalous consequences because, in the Bombay school where the rule of right by birth and survivorship were never expected to be part of the rule of inheritance and succession of Hindu law retained by Cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Courts on the applicability to the Cutchi Memons by way of custom of Hindu joint family rules and the distinction firmly made by the Madras High Court between the joint family rule of survivorship on the one hand and succession and inheritance on the other, leaving the position undisturbed, coupled with the use of the words "succession and inheritance" by the Central Legislature in the Cutchi Memons Act of 1938 at a time when it must have been aware of the distinction drawn by the Madras High Court between those words and survivorship lends colour to an inference that in this part of the country (South India) the Hindu joint family rules continue to apply to Cutchi Memons by way of custom." This view is contrary to what we have explained earlier on the interpretation to be given to the expression "inheritance and succession" used in the Act. Therefore, we have no option but to reject this contention. We can approach this problem from another angle. The Supreme Court rested its decision in CED v. Hajee Abdul Sattar Salt [1972] 86 ITR 53, solely on the ground that the assessee and his brother were born before 1946 and, therefore, their right was saved under section 3 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C.) v. CIT [1974] 97 ITR 493, that to constitute family, there must be a plurality of members and not a single member, though a sole surviving coparcener can form a family with other members and they need not be coparceners. Still, a single member cannot constitute a family if, on the date on which the Act came into force, he remained unmarried. In so far as the., assessee is concerned, his right was saved to only 1/3rd of the property that passed to him on that day and thereafter he held the property as a Muhammadan and joint family came to be extinguished on that day except to the extent his rights had been saved earlier as stated above. Therefore, the resultant position is that the assessee was an individual on the date when the Act came into force and not a member of the Hindu undivided family and, therefore, the law applicable to him is as provided in the Act, that is, the Muhammadan law. The Muhammadan law does not take within its scope the concept of right by birth and the rule of survivorship. In the light of the discussion made above, our answer to the various questions referred to us are as follows : (i) The applicant is a Cutchi Memon but he is not governed in matter ..... X X X X Extracts X X X X X X X X Extracts X X X X
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