COMMISSIONER OF WEALTH TAX Vs. RAMESHWAR LAL AGARWAL

JUDGEMENT

(1.) THE following questions of law have been referred for the decision of this court under Section 27(1) of the Wealth-tax Act, 1957, at the instance of the Commissioner of Wealth-tax, by the Tribunal:

(2.) THE material facts are these : For the assessment years 1972-73 to 1975-76, the assessee/respondent submitted his returns, claiming his status as Hindu undivided family. THE property in question originally belonged to the father of the assessee/respondent, Shri Mohanlal Agrawal, who expired on September 30, 1971. According to the assessee/respondent, he was married on May 8, 1970, and a son was born to him on September 26, 1971. Further, the assessee claimed that after the death of his father, which was after the Hindu Succession Act, 1956, came into force, whatever property was left, was, in fact, the property of the Hindu undivided family consisting of himself, his wife and his son, and, therefore, he could not be assessed as an individual, since all of them had a share in the said property. THE Wealth-tax Officer rejected the claim of the assessee/respondent and assessed him as an individual on the ground that the concept of Hindu undivided family has been done away with after the Hindu Succession Act, 1956, has come into force and whatever property devolves on the heir, it assumes the character of individual property and this view of the Wealth-tax Officer was upheld in appeal by the Appellate Assistant Commissioner holding, inter alia, that the property which devolved on the assessee/respondent consequent upon the death of the father of the assessee definitely assumes the character of individual property and not joint family property. Being aggrieved, the assessee/respondent preferred further appeal before the Tribunal who took the view following the decision in CIT v. Dr. Babubhai Mansukhbhai [1977] 108 ITR 417 (Guj) that in cases of Hindus governed by the Mitakshara law, where a son inherits the self-acquired property of his father, the son takes it as the joint family property of himself and his son and not as his separate property. THE Tribunal further noted that the correct status for the assessment of the son in respect of such property is as representing his Hindu undivided family. Under the circumstances of the case, therefore, the Tribunal held that the proper status of the assessee was that of a Hindu undivided family and not an individual.

(3.) THERE shall be no order as to the costs.