COMMISSIONER OF INCOME TAX Vs. MARKANDEYA

JUDGEMENT

(1.) The following two questions of law arising out of the order of the Tribunal dated 18.6.1987 in I.T.A. Nos.818 to 820/Hyd/85 are referred to this Court by the Tribunal as directed by this Court under Section 256(2) of the Income-Tax Act, 1961. (1) Whether on the facts and in the circumstances of the case, the Incometax Appellate Tribunal was correct in law in holding that the Kartha's wife is entitled to a share at the time of partition on par with her sons in lieu of maintenance; (2) Whether on the facts and in the circumstances of the case, the Incometax Appellate Tribunal should have observed that since Kartha is getting a share at the time of partition with his sons, his wife is not entitled to a share towards maintenance;

(2.) One I. Markandeya and his two sons Srihari and Sridhar were co-parceners of the joint family of which the said /. Markandeya was the Kartha. The joint family owned a house at Bellary. It was acquired by the Government of India and the joint family received a sum of Rs.3,89,995/- by way of compensation. Thereafter, a Memorandum was executed on 24.12.1978 to record the oral partition giving 1/4th share to each of the male members of the joint family consisting of I.Markandeya and his two minor sons as well as his wife by name Smt. Sita Mahalakshmi. In terms of the memorandum, it was agreed among them that the amount of compensation be divided equally between the Kartha, his wife and two minor sons. The Income-tax Officer accepted the assessee's claim of partition dividing the property into four shares and on that basis computed the income. However, subsequently the Commissioner of Income- tax exercising power under Section 263 of the Act held that according to Southern School of Mitakshara Law, the wife is not entitled to a separate share in the joint family property and therefore, the assessment made by the Income-tax Officer holding that 1/4th share of capital gain is assessable in the hands of each of these assessees is erroneous and prejudicial to the interest of revenue, by his order dated 29.3.1985. Against the said order of the Commissioner of Income-tax, the father and two sons preferred appeals before the Income-Tax Appellate Tribunal.

(3.) Before the Tribunal it was contended that though the practice of allotting a share to the wife has become obsolete, still it is not a Rule of law. Alternatively it was contended that under the provisions of the Hindu Adoption and Maintenance Act, 1956, the wife is entitled to maintenance and therefore, 1/4th share allotted to her be treated as the maintenance provided to her at the time of the partition of the joint family property. It is also contended that l/4th share allotted to the wife towards maintenance is not excessive. The Tribunal placing reliance on the judgment of the Madras High Court in P. Audemma v. P. Varadareddy, AIR 1949 Mad. 31 and on the judgment of this Court in Adusumilli Seethamahalakshmamma v. Yemeni Chalamaiah and others, AIR 1974 AP 130, held that the wife is not entitled to a separate share in the joint family property. However, the Tribunal on consideration of many authorities and case law, including the judgment of this Court in C. G. T. v. V. Vallum Venkateshwara Rao, 1979 (12) CTR 247, came to the conclusion that the wife of the Kartha is entitled to be maintained by the Kartha and her sons and a provision could be made in favour of such female at the time of partition of the property of the Hindu joint family. The Tribunal also found as a matter of fact that l/4th share in the joint family property was allotted to the wife of the Kartha at the time of partition towards her maintenance. So holding the Tribunal allowed the appeals filed by the father and two sons.