Judgement Consolidated Appeals (Nos. 24 to 29 of 1936) from a judgment of the High Court (December 13, 1934) upon six references made under s. 66, sub-s. 2, of the Indian Income-tax Act, 1922. These six appeals raised the question whether the six appellants, members of a firm dealing in Indian tobacco and cigarettes, were liable to be assessed for the assessment year 1931-32 to super-tax individually on the scale applicable to individuals, or as Hindu undivided families on the scale applicable thereto as representing their respective families. The questions referred by the Commissioner were — (1.) Whether the family of the assessee, as it now stands, is a Hindu undivided family within the meaning of the Income-tax Act ? (2.) If the first question be answered in the affirmative, whether in the circumstances recorded in this case the income in question should be treated as income of that family and assessed as such? The facts and the terms of s. 55 of the Income-tax Act, 1922, appear from the judgment of the Judicial Committee. The High Court (Lort-Williams and Jack JJ.) in each case answered the first question in the negative, and held that the second question did not therefore arise. 1936. Nov. 2, 3 and 5. De Gruyther K.C. and L. P. E. Pugh for the appellants. The questions are, what is an Hindu undivided family within the meaning of the Income-tax Act, 1922, and is the Hindu undivided family limited to the coparcenary or not ? The view of the High Court was that it is only the coparcenary which falls within the definition. [Reference was made to s. 2, sub-ss. 1, 2, and to ss. 3 and 55 of the Act of 1922, as amended by the Income-tax Act, 1924.] Vedathanni v. Commissioner of Income-tax, Madras (( 1932) I. L. R. 56 M. 1.), definitely states that where there is one owner and persons claiming maintenance, that is a Hindu undivided family, and it has to be taxed as such. The proposition there laid down is that to constitute a Hindu undivided family within the meaning of the Act it is not necessary to have two male members ; that the words " Hindu undivided family " can cover a case of one male member of the family with female members claiming maintenance, and it is not necessary that there should be two co-parceners. Krishan Kishore v. Commissioner of Income-tax (( 1932) I. L. R. 14 Lah. 255.) decides that to constitute a Hindu undivided family within the meaning of the Act it is not essential that there should be anybody who can have a claim to partition. In Commissioner of Income-tax, Bombay v. Laxminarayan (( 1935) I-L. R. 59 B. 618.) the question was whether a sole owner having his wife and mother living with him constituted a Law. Rep. 64 Ind. App. 28 ( 1936- 1937) Kalyanji Vithaldas V. Commissioner of Income-Tax, Bengal 206 Hindu undivided family within the meaning of the Act. In that case Rangnekar J. said (Ibid. 624.) " Mayne in his work at page 344 observes as follows — The whole body of such a family, consisting of males and females, . . . some of the members of which are co-parceners, that is, persons who on partition would be entitled to demand a share, while others are only entitled to maintenance V That is exactly what the appellants are now suggesting. [Reference was also made to Janakiram Chetty v. Nagamony Mudaliar. (( 1925) I- L. R. 49 M. 98.) As to whether " Hindu undivided family" is interchangeable with " coparcenary fl reference was made to Maynes Hindu Law, 9th ed., at pp. 343, 347; Mullas Hindu Law, 8th ed., p. 230.] The authorities establish that the mere fact that there is only one male in a family, although there are females, does not prevent that family from being a Hindu undivided family within the meaning of the Act. If a Hindu under the Mitakshara dies intestate then his sons, grandsons and great-grandsons succeed to his joint undivided property. If, on the other hand, the father makes a gift to them in his lifetime, or devises it to them by will, the property when it comes to the sons who would have taken under an intestacy is in exactly the same position and with the same limitations as if there had been such intestacy. M. Gopal Thakoor v. R. Buksh Pandey (( 1863) 6 W. R. 71.) was carried through by Hazari Mall Babu v. Abaninath Adhurjya. (( 1912) 17 C. W. N. 280, 284-5.) It has never been dissented from on the Calcutta side. Madras has followed Calcutta Janakiram Chetty v. Nagamony Mudaliar. M. Gopal Thakoor v. R. Buksh Pandey (( 1863) 6 W. R. 71.) was carried through by Hazari Mall Babu v. Abaninath Adhurjya. (( 1912) 17 C. W. N. 280, 284-5.) It has never been dissented from on the Calcutta side. Madras has followed Calcutta Janakiram Chetty v. Nagamony Mudaliar. (( 1925) I. L. R. 49 M. 98.) On the other hand, Allahabad and Bombay have taken a different view Oudh followed Allahabad Lal Ram Singh v. Deputy Commissioner of Partabgarh. (( 1923) L. R. 50 I. A. 265, 274.) The words " Joint Hindu undivided family " are especially meant in a very large sense, and if it was intended to qualify them in any way it was the duty of the Legislature to have made it perfectly plain that they could not be read as meaning other than a coparcenary. Applying the authorities to the facts of the present appeals the families of all the appellants were " undivided Hindu families/ and there is no justification for putting a construction on these words other than their ordinary meaning in Hindu law. Further, all the appellants had expressly waived any right to treat their capitals and earnings as self-acquired property, and have manifested an intention that the same should be the joint property of the families, with the result that their earnings were property of the undivided Hindu families. The reasoning of the High Court is fallacious in that it leads to the conclusion that the terms 11 undivided Hindu family "would be limited to a Mitakshara joint family and would not apply to a Dayabhaga joint family. Pugh followed. With regard to the Commissioners findings, a finding of fact is conclusive, but the apparent findings of fact in the reference orders are either pure questions of law or mixed questions of fact and law and, as such, are open to review Westminster (Duke) v. Inland Revenue Commissioners, ([ 1936] A. C. 1, 15.) [Reference was made to Sundarams Law of Income Tax in India, 4th ed., p. 118, on the position of the Dayabhaga family ; to Rampershad Tewarry v. Sheochurn Doss (( 1866) 10 Moo. I. A. 490, 505.n) and to Sri Raghunadha v. Sri Brozo Kishoro (( 1876) L R. 3 I A. 154, 191.), which recognizes the existence beyond any doubt of an individual Hindu family.] Dunne K.C. and E. L. Norton for the respondent. I. A. 490, 505.n) and to Sri Raghunadha v. Sri Brozo Kishoro (( 1876) L R. 3 I A. 154, 191.), which recognizes the existence beyond any doubt of an individual Hindu family.] Dunne K.C. and E. L. Norton for the respondent. The question is, what interpretation is to be put on the words “Hindu undivided family " ? It can only be a unit for taxation if it possesses an income, and if it does possess an income it can only be owned in a Hindu family by those who are entitled to partition it, and they are the co-parceners; it cannot be that large body which Mayne describes as a fringe on the real coparceners in a Hindu family, which would have rights of maintenance. Beaumont C.J. in Commissioner of Income-tax v. Laxminarayan (( 1935) I. L. R. 59 B. 618.) accepts Vedathanni v. Commissioner of Income-tax, Madras (5), as covering the case before him. It is submitted that it did not. Direct taxation of the person to be assessed is here being dealt with, Vedathannis case (( 1932) I. L. R. 56 M. 1.) was not dealing with that. It is submitted that in the Act Law. Rep. 64 Ind. App. 28 ( 1936- 1937) Kalyanji Vithaldas V. Commissioner of Income-Tax, Bengal 207 " Hindu undivided family " is interchangeable with " coparcenary." A practical meaning must be given to the Act, and it is quite clear as to what was meant in regard to the duties of the taxing authorities when income has to be taxed. The whole question is, what did the Legislature mean when they used this phrase as embodying a unit which in fact is a group of individuals, but treated it as a unit having as a group an income ? [Reference was made to s. 2, sub-s. 9 ; ss. 3, 14, sub-s. 1 ; ss. 15, 23, 25, 38, sub-s. 1 ; ss. 55, 56, 58 and 63, of the Act of 1922.] The term " Hindu undivided family " must be construed by reference to the Act, and it is no use going into Hindu law and substituting other phrases which have in the course of time acquired different meanings. The only test is that it is to be a Hindu family, undivided. The only test is that it is to be a Hindu family, undivided. If it is an undivided family it is charged as a unit, and it must be composed of members who can divide. [LORD ALNESS Both Mayne and Mulla say in terms that the Hindu undivided family includes the coparcenary and much more.] The joint undivided family includes the coparcenary and the fringe of persons entitled to maintenance. An Act says that what is to be found is an income coming to a Hindu undivided family ; how can that possibly apply to anybody but the coparcenary ? The fringe has no right to divide —it cannot divide. It is the income of the coparcenary, and out of it the fringe is entitled to maintenance, but the persons who are the owners of that income are the coparceners. There appears to be no authority directly on the point what the phrase means in the Act. The families of the appellants during the year of assessment were not Hindu undivided families within the meaning of the Act. The incomes of the appellants were found as a matter of fact by the Commissioner of Income-tax to be their separate property, and the expression " the total income ... of any Hindu undivided family " in s. 55 cannot and does not include income which is the separate property of the members of a Hindu family. The incomes of the appellants were rightly assessed to super-tax as the incomes of individuals and not as the incomes of Hindu undivided families. De Gruyther K.C. replied. Nov. 30. The judgment of their Lordships was delivered by SIR GEORGE RANKIN. These six appeals concern the assessment to super-tax for the year 1931-2 of six of the seven partners of a firm known as Moolji Sicka & Co. This firm was for the year in question registered under s. 36A of the Income-tax Act, the instrument of partnership being a Gujrati deed dated September n, 1930. Its business was that of dealers in Indian tobacco and cigarettes. The assessment to income-tax of the registered firm has been made in due course, and the present controversy is whether six of the partners should each be assessed to super-tax upon his share of the profits as an individual, or whether these six shares should each be assessed as income of a Hindu undivided family. The assessment to income-tax of the registered firm has been made in due course, and the present controversy is whether six of the partners should each be assessed to super-tax upon his share of the profits as an individual, or whether these six shares should each be assessed as income of a Hindu undivided family. The rates of super-tax imposed by the relevant Finance Act are less in the case of a Hindu undivided family than in the case of an individual. The problem has to be answered by applying to the facts of each case the language of s. 55 of the Act In addition to the income-tax charged for any year, there shall be charged, levied and paid for that year in respect of the total income of the previous year of any individual, Hindu undivided family, company, unregistered firm or other association of individuals, not being a registered firm, an additional duty of income-tax (in this Act referred to as super-tax) at the rate or rates laid down for that year by Act of the Indian Legislature. Provided that, where the profits and gains of an unregistered firm have been assessed to super-tax, super-tax shall not be payable by an individual having a share in the firm in respect of the amount of Law. Rep. 64 Ind. App. 28 ( 1936- 1937) Kalyanji Vithaldas V. Commissioner of Income-Tax, Bengal 208 such profits and gains which is proportionate to his share. The two questions finally referred in each case by the Commissioner for the opinion of the High Court at Calcutta are as follows (1.) Whether the family of the assessee, as it now stands, is a Hindu undivided family within the meaning of the Income-tax Act ? (2.) If the first question be answered in the affirmative, whether in the circumstances recorded in this case the income in question should be treated as income of that family and assessed as such ? The High Court (Lort-Williams and Jack JJ.) have in each case answered the first question in the negative and held that the second question did not arise. The parties are governed by the Mitakshara and their pedigrees and families may be exhibited as under I Sicka | | | Moolji Purshottam (d. Dec. The High Court (Lort-Williams and Jack JJ.) have in each case answered the first question in the negative and held that the second question did not arise. The parties are governed by the Mitakshara and their pedigrees and families may be exhibited as under I Sicka | | | Moolji Purshottam (d. Dec. 1933) wife | Odhavji (son) daughter Wife2 Wife1 || | Kanji wife Sewdas Mohan Das daughter wife II Vithaldas | ||| Kalyanji wife 3 sons daughter Chaturbhuj wife daughters Champsi The history of the firm according to the Commissioner is that in or about 1912 the business was begun by Moolji and Purshottam (brothers who had separated) and Kalyanji (who is not related to either), and that in no case were ancestral funds employed for the purpose. That in 1919 Moolji made gifts of capital to each of his sons by his first wife—namely, Kanji and Sewdas. That at least since 1919 Moolji, Kanji and Sewdas have been separate from each other. That in 1919 on the terms of a Gujrati deed dated May 1, Kanji (son of Moolji) and Chaturbhuj (brother of Kalyanji) were taken into the partnership. That in 1930 Sewdas and Kalyanjis brother Champsi were taken into the firm on the terms of the deed of September 11, 1930, already mentioned. That the interest of Kanji and of Sewdas was a gift from their father Moolji, and that of Chaturbhuj a gift from his brother Kalyanji. That in no case has it been proved that the individual partner has thrown his interest in the firm or his receipts therefrom into the common stock, i.e., treated it as joint family property. Their Lordships are of opinion that the High Court was right in proceeding upon these findings of fact by the Commissioner. From these facts it clearly appears, so far as Moolji, Purshottam and Kalyanji are concerned, that they Law. Rep. 64 Ind. App. 28 ( 1936- 1937) Kalyanji Vithaldas V. Commissioner of Income-Tax, Bengal 209 are each members of a Hindu undivided family. Each has a son or sons from whom so far as the evidence goes he is not divided. But the income from the firm is clearly the separate and self-acquired property of the partner, and, as it has not been thrown into the common stock, it cannot be regarded as income of the family. Each has a son or sons from whom so far as the evidence goes he is not divided. But the income from the firm is clearly the separate and self-acquired property of the partner, and, as it has not been thrown into the common stock, it cannot be regarded as income of the family. It is the income of an individual and assessable to super-tax as such under s. 55 of the Act. In these three cases, therefore, the High Court should have answered the first question in the affirmative and the second question in the negative. The interest of Chaturbhuj in the firm was obtained from his brother Kalyanji. It is self-acquired and not ancestral property Chaturbhuj has no son, but even if he had the son would have taken by birth no interest in the income now in question. The High Court might well have answered the second question in the negative and said of the first question that it did not arise. In none of the four cases above-mentioned—namely, those of Moolji, Purshottam, Kalyanji and Chaturbhuj—does the fact that the man has a wife and daughter (or more than one) affect the result. The existence of a son does not make his fathers self-acquired property family property or joint property. That the existence of a wife or daughter does so is untenable. There remain the cases of Kanji and Sewdas. Neither has a son, but, in the case of each, his interest in the firm was obtained by gift from his father Moolji. Without deciding the question which was left open in Lal Ram Singh v. Deputy Commissioner of Partabgarh (( 1923) L. R. 50 I. A. 265.) their Lordships, for the purposes of the present case, will assume that their interest was ancestral property, so that, if either had had a son, the son would have taken an interest therein by birth. But, no son having been born, no such interest has arisen to qualify or diminish the interest given by Moolji to Kanji and to Sewdas. Does then the existence of a wife, or of a wife and daughter, make it income of a Hindu undivided family rather than income of the individual partner ? Their Lordships think not. But, no son having been born, no such interest has arisen to qualify or diminish the interest given by Moolji to Kanji and to Sewdas. Does then the existence of a wife, or of a wife and daughter, make it income of a Hindu undivided family rather than income of the individual partner ? Their Lordships think not. A mans wife and daughter are entitled to be maintained by him out of his separate property as well as out of property in which he has a coparcenary interest, but the mere existence of a wife or daughter does not make ancestral property joint. " Interest " is a word of wide and vague significance, and no doubt it might be used of a wifes or daughters right to be maintained, which right accrues in the daughters case on birth ; but if the fathers obligations are increased, his ownership is not divested, divided or impaired by marriage or the birth of a daughter. This is equally true of ancestral property belonging to himself alone as of self-acquired property. The cases of Kanji and of Sewdas can be disposed of by answering the second question in the negative. The High Court approached the cases by considering first whether the assessees family was a Hindu undivided family, and in the end left unanswered the question whether the income under assessment was the income of that family. This is due no doubt to the way in which the Commissioner had stated the questions. But, after all, if the relevant Hindu law had been that the income belonged, not to the assessee himself, but to the assessee, his wife and daughter jointly, it is difficult to see how that association of individuals could have been refused the description " Hindu joint family." The phrase " Hindu undivided family " is used in the statute with reference, not to one school only of Hindu law, but to all schools; and their Lordships think it a mistake in method to begin by pasting over the wider phrase of the Act the words " Hindu coparcenary "—all the more that it is not possible to say on the face of the Act that no female can be a member. The Bombay High Court, on the other hand, in Laxminarayan’s case ((1035) I. L. R. 50 B. 618.), having held that the assessee, his wife and mother were a Hindu undivided family, arrived too readily at the conclusion that the income was the income of the family, The phrase which has to be considered and applied to the facts is " the total income of the previous year of any individual, Hindu undivided family, company, unregistered firm or other association of individuals not being a registered firm." The words " income of " are simple words and are capable of wider or narrower meaning; but for the present purpose the Courts are concerned with them as they appear in an Income-tax Act ; and under s. 3 or s. 55 income is not to be attributed Law. Rep. 64 Ind. App. 28 ( 1936- 1937) Kalyanji Vithaldas V. Commissioner of Income-Tax, Bengal 210 to any one of the five classes of persons mentioned by any loose or extended interpretation of the words, but only where the application of the words is warranted by their ordinary legal meaning. The relevant meaning in the present cases is the ordinary meaning in Hindu law according to the Benares school. In an extra-legal sense, and even for some purposes of legal theory, ancestral property may perhaps be described, and usefully described, as family property ; but it does not follow that in the eye of the Hindu law it belongs, save in certain circumstances, to the family as distinct from the individual. By reason of its origin a mans property may be liable to be divested wholly or in part on the happening of a particular event, or may be answerable for particular obligations, or may pass at his death in a particular way ; but if, in spite of all such facts, his personal law regards him as the owner, the property as his property and the income therefrom as his income, it is chargeable to income-tax as his, i.e., as the income of an individual. In their Lordships view it would not be in consonance with ordinary notions or with a correct interpretation of the law of the Mitakshara, to hold that property which a man has obtained from his father belongs to a Hindu undivided family by reason of his having a wife and daughters. In their Lordships view it would not be in consonance with ordinary notions or with a correct interpretation of the law of the Mitakshara, to hold that property which a man has obtained from his father belongs to a Hindu undivided family by reason of his having a wife and daughters. The result is that in the cases of Moolji, Purshottam and Kalyanji the first question stated by the Commissioner should be answered Yes, and the second No. In the other cases the second question should be answered No, and the first question need not be answered. Upon the reported decisions cited during argument their Lordships will only observe that the decision in Vedathannis case (( 1932) I. L. R. 56 M. 1.) does not cover the present question which arises under s. 55 of the Act, and that they take no exception to the result arrived at in the case of Raja Bhunesh Pratap Narain Singh (( 1932) 6 Ind. T. C. 175.), though they do not agree that a Hindu joint family necessarily consists of male members only. Their Lordships will not here deal with the case of an impartible estate held by the senior of several male members of a family, as to which there have been conflicting decisions in India (cf. Raja Shiva Prasad Singh v. Secretary of State (( 1924) 1 Ind. T. C. 384, 388-9.) ; Krishan Kishores case (( 1932) I. L. R 14 Lah. 255.). They will humbly advise His Majesty that the appeals should be dismissed with costs.