TMI Blog1967 (12) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... legislature has by the amended clause (ii) expressly provided that, where the assessee is a Hindu undivided family, any expenditure incurred by any dependant of the assessee, from or out of any income or property transferred directly or indirectly to the dependant by the assessee, is liable to be included. The words are not susceptible of the interpretation that the dependant who incurs the expenditure must be other than the dependant to whom the property is transferred by the assessee. Expenditure incurred for his own purposes by the dependant to whom the property is transferred by the Hindu undivided family clearly falls within section 4(ii) as amended. Modify the order of the High Court. The answer to the first question for each year will be in the negative. The answer to the second question will be in the affirmative. - C.A. 2523 OF 1966 - - - Dated:- 12-12-1967 - Judge(s) : V. BHARGAVA., J. C. SHAH., V. RAMASWAMY JUDGMENT The judgment of the court was delivered by SHAH J.--One Surendra had by his wife Rameshchandrika (who died in 1947) three children--Darshan, Ranna and Rajeshri. By his second wife Pratima he had two sons and one daughter. Surendra, his wife Pra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding under this Act has been taken for the assessment of his expenditure ". Section 2(g) defines " dependant " as meaning " (i) where the assessee is an individual, his or her spouse or child wholly or mainly dependent on the assessee for support and maintenance ; (ii) where the assessee is a Hindu undivided family--(a) every coparcener other than the karta ; and (b) any other member of the family who under any law or order or decree of a court, is entitled to maintenance from the joint family property ". Section 2(h) defines " expenditure " as meaning " any sum in money or money's worth, spent or disbursed or for the spending or disbursing of which a liability has been incurred by an assessee, and includes any amount which under the provisions of this Act is required to be included in the taxable expenditure ". Section 3 which imposes the charge of expenditure-tax provides : " Subject to the other provisions contained in this Act, there shall be charged for every financial year commencing on and from the first day of April, 1958, a tax (hereinafter referred to as expenditure-tax) at the rate or rates specified in the Schedule in respect of the expenditure incurred by any indivi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... personal requirement of a dependant, and is liable to be included in the taxable expenditure of the Hindu undivided family under section 4(i) of the Act. In the definition of the expression " dependant " in section 2(g)(ii)(b) the expression " other member of the family " does not include a coparcener ; it means wives and unmarried daughters of coparceners and widows in the family. A karta of a Hindu family being expressly excluded from clause (a), he is not within the meaning of clause (b) " other member of the family ". To include him in the expression " other member of the family " would make the exclusion of the karta in clause (a) meaningless. A karta of a Hindu undivided family is, therefore, not a "dependant " within the meaning of section 2(g)(ii) of the Act. Under the Act, a Hindu undivided family is a taxable entity distinct from its coparceners and other members. A coparcener or other member of a Hindu undivided family is, for purposes of assessment of the family to expenditure-tax, a person other than the assessee. Expenditure incurred out of the family estate by the karta for and on behalf of the family is undoubtedly expenditure by the Hindu undivided family and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the meaning which is assigned thereto by the definition in clause (g) of section 2, the court would be justified in discarding that definition. It is a settled rule of interpretation that, in arriving at the true meaning of any particular phrase in a statute, the phrase is not to be viewed isolated from its context ; it must be viewed in its whole context, the title, the preamble and all the other enacting parts of the statute. It follows therefrom that all statutory definitions must be read subject to the qualifications expressed in the definition clauses which create them, such as " unless the context otherwise requires " ; or " unless a contrary intention appears " ; or " if not inconsistent with the context or subject-matter ". But there is nothing in the scheme of the Act which suggests that the expression " dependant " in section 4(i) of the Act was used in a different sense. Section 4(i) is intended to include expenditure incurred directly or indirectly by a person other than the assessee for discharging any obligation or for personal requirement of the assessee or dependant of the assessee. The clause applies in the computation of the expenditure of an individual as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing within the net the expenditure for the karta. The court cannot attribute two different meanings to a single expression in its application to two different situations contemplated by a single clause. The case is one clearly of defective draftsmanship. In sections 5 and 6 wherever it was thought necessary, having regard to the special relation between members of a Hindu undivided family, Parliament has restricted the use of the expression " dependant " to individual assessees, and has used different phraseology in defining exclusions and deductions in computing the taxable expenditure of assessees ; see section 5 (r), section 6(c) (ii), section 6(f) (ii), section 6(g) and section 6(h). In section 4, however, Parliament has in seeking to attain undue brevity failed to make provision for inclusion in computing the taxable expenditure of a Hindu undivided family expenditure incurred by the karta out of his separate estate, which expenditure would have been incurred by the family if it was not incurred by the karta. Expenditure incurred by Surendra out of his separate property cannot, therefore, be taken into account in computing the taxable expenditure of the Hindu undivided fami ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure, to bring the case within the terms of section 4(ii), must be other than the dependant who obtains the benefit of that expenditure. In our view, the High Court was in error in observing that the expenditure contemplated under clause (ii) of section 4 is one which enures for the benefit of a person other than the person who incurs the expenditure. If expenditure was incurred by a dependent for his own purposes or benefit out of any gift, donation or settlement on trust or out of any other source made or created by the Hindu undivided family, the case clearly fell within the terms of section 4(ii) before the clause was amended by the Finance Act, 1959. There is nothing in the Act to show that the application of the clause was restricted to cases in which the dependant incurred expenditure for another dependant. Turning now to Civil Appeal No. 2524 of 1966, which arises out of the reference to the High Court on two questions framed in language identical with the language of the questions in the main appeal, but with different amounts of expenditure relating to the assessment year 1959-60, it is unnecessary to set out the different components of the taxable expenditure in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t would full within clause (ii). The legislature has by the amended clause (ii) expressly provided that, where the assessee is a Hindu undivided family, any expenditure incurred by any dependant of the assessee, from or out of any income or property transferred directly or indirectly to the dependant by the assessee, is liable to be included. The words are not susceptible of the interpretation that the dependant who incurs the expenditure must be other than the dependant to whom the property is transferred by the assessee. Expenditure incurred for his own purposes by the dependant to whom the property is transferred by the Hindu undivided family clearly falls within section 4(ii) as amended. We, therefore, modify the order of the High Court. The answer to the first question for each year will be in the negative. The answer to the second question will be in the affirmative. It must, however, be understood that this answer does not imply that the amount of Rs. 10,321 in respect of the assessment year 1958-59 was the amount spent by the trustees. In disposing of the appeal under section 25(6) of the Expenditure-tax Act, the Tribunal must make appropriate adjustments in declaring th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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