COMMISSIONER OF WEALTH TAX Vs. PRITHVI RAJ JI

JUDGEMENT

(1.) THE petitioner is seeking reference of the following three questions to this Court : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that neither 1/6th share nor 1/36 share (being 1/6th of the 1/16th belonging to the bigger HUF of late Maharaja H. H. Sawai Man Singh) could be said to have devolved on the assessee although the late Maharaja had originally during his lifetime filed the wealth -tax returns in 'individual' capacity and the claim of bigger HUF subsequently made by the legal heirs of late Maharaja was an afterthought ? (2) Whether, on the facts and in the circumstances of the case, the finding of the Tribunal is not perverse as it has been reached without taking into consideration the fact that the late Maharaja H. H. Sawai Man Singh during his lifetime had himself claimed the status of 'individual' and had filed the returns of wealth in that capacity ? (3) Whether the Tribunal being the final fact -finding authority was correct in not considering the conduct of late Maharaja H. H. Sawai Man Singh who had himself claimed the status of 'individual' and had filed the returns in the status of 'individual' ?" Late Maharaja Man Singh was the father of Prithvi Raj Ji. Man Singh died and a question arose as to whether what was inherited by Prithvi Raj Ji, on the death of Man Singh, was inherited in his "individual" capacity or by his HUF. The case of the Department was that Man Singh used to declare this property in his "individual" capacity. That question is pending adjudication in this Court in separate proceedings. The WTO sought to tax the share of Prithvi Raj Ji received on the death of Man Singh in the hands of Prithvi Raj Ji (HUF). This was presumably on the basis of the return filed by the respondent. The question, however, arose whether this property was inherited by the respondent or by Prithvi Raj Ji in his "individual" capacity. The Tribunal observed that the property was not assessable in the hands of the respondent but it then noted that there was a bigger HUF of Man Singh and, even after the death of Man -Singh, the share "should be presumed to remain in the bigger HUF". According to learned counsel for the petitioner, the aforesaid conclusion, namely, that the share of Man Singh, on his death, continued to remain in the bigger HUF is not a correct statement of Hindu law. The observations of the Tribunal seem to indicate that there was a bigger HUF and Man Singh had a share in that HUF and that continued to remain in the HUF. Learned counsel for the respondent states that the aforesaid observation of the Tribunal with regard to the share of Man Singh remaining in the bigger HUF may not be a correct proposition of Hindu law but till an order under S. 20 of the WT Act is passed, the larger HUF, if it exists, cannot be regarded as having been disrupted. We, however, need not go into that aspect because that does not arise in the present case. All that we are concerned with is whether Prithvi Raj Ji inherited interest in the property on the death of Man Singh, in the status of an HUF or as an "individual". It is not disputed that, in view of the decisions of the Supreme Court, CWT vs. Chander Sen (1986) 161 ITR 370 and State of Maharashtra vs. Narayan Rao Sham Rao Deshmukh (1987) 163 ITR 31, on the death of the father, property is inherited by the son in his "individual" capacity and not in the capacity of an HUF. Therefore, whether the property was held by Man Singh in his "individual" capacity or as a member of a bigger HUF, his share would not devolve on Prithvi Raj Ji (HUF). In our opinion, therefore, the questions proposed are academic being covered by the aforesaid decisions of the Supreme Court and the petition is, accordingly, dismissed. There will be no order as to costs. It will be open to the Department to raise such contentions as they may be advised in law in case of individual assessment or individual case of Prithvi Raj Ji and the rejection of this application will not stand in the way of the Department.