GORDHANDAS T MANGALDAS Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) THIS is a reference made by the Appellate Tribunal, Bombay Bench, under Section 66(1) of the Indian Income-tax Act, raising a question which has given rise to a difference of judicial opinion. The question is : Whether on the facts of this case it has been rightly held that the joint family property of the petitioner and his sons has not been partitioned in definite portions within the meaning of Section 25A(1) of the Indian Income-tax (Amendment) Act, 1922?

(2.) THE facts giving rise to the question have never been in dispute. THE assessment year is the year 1939-40, and down to July 3, 1939, there was a Hindu joint family consisting of the father and three sons, and on that date severance took place. THE three sons all intimated an unequivocal desire to sever the joint family, and according to the law applicable to Hindu joint families under the Mitakshara system that expression of a wish on the part of the sons severed the joint family, and, as there were only four coparceners, the necessary result was that the shares in the joint family property became divided equally between the four coparceners, who then held as tenants-in-common. But there has been no physical division of the joint family property. I use the expression "physical division" in preference to the more usual expression "division by metes and bounds," because the latter expression is only applicable strictly to immoveable property. Both the Assistant Commissioner and the Appellate Tribunal considered that a mere severance of the joint family) was not enough for the purpose of Section 25A; that there must be an allotment of shares, though both Tribunals thought that a physical division was not necessary. I must confess that I do not follow that opinion. It appears to me perfectly plain, on the finding that the joint family severed in July, 1939, that the shares were definitely ascertained, and there being four members of the family each became entitled to a one-fourth share of the family property. To my mind, the real question to be determined is whether Section 25A requires a physical division, or is satisfied only by a division in interest.

(3.) SUB-section (2) deals with assessment when an order is made under SUB-section (1), and under SUB-section (3) the family is to be deemed to be undivided unless an order is passed under SUB-section (1).