Case: Gowlibuddanna Vs. Commissioner Of Income-Tax, Mysore,Bangalore

1. One Buddappa, his wife, his two unmarried and his adopted son Buddanna were members of a Hindu undivided family, Buddappa died on July 9, 1952. In respect of the business dealings of the family, Buddappa was assessed during his life-time in the status of a manager of the Hindu undivided family. For the assessment year 1951-52 the Additional Income-tax Officer, Raichur assessed Buddanna in respect of the income of the previous year which ended on November 8, 1950, as a Hindu undivided family under the title "Sri Gowli Buddappa (deceased) represented by his legal successor Sri. Gowli Buddanna. Oil Mills Owner, Raichur." The order of assessment was confirmed in appeal by the Appellate Assistant Commissioner was made under the title "Buddanna-a Hindu undivided family". The Income-tax Appellante Tribunal confirmed the order of the Appellate Assistant Commissioner.2. The Tribunal then referred the following questions of law to the High Court of Mysore for opinion under S. 66 (1) of the Indian Income-taxWhether the sole male surviving coparcener of the Hindu joint family, his widowed mother and sisters constitute a Hindu undivided family within the meaning of the Income-tax Act?(ii) Whether the assessment of the income in the hands of the Hindu undivided family was correct?(iii) Whether the Appellate Assistant Commissioner was entitled to correct theHigh Court recorded answers in the affirmative on all the questions. With certificate granted by the High Court under S. 66-A of the Indian Income-tax Act, Buddanna has appealed to this Court.

Reasoning: Under S. 3 of the Income-tax Act not a Hindu coparcenary but a Hindu undivided family is one of the assessable entities. A Hindu joint family consists of all persons lineally descended from a common ancestor, and includes their wives and unmarried daughters. A Hindu coparcenary is a much narrower body then the joint family: it includes only those persons who acquire by birth an interest in the joint or coparcenary property, these being the sons, grandsons, and great-grandsons of the holder of the joint property for the time being. Therefore there may be a joint Hindu family consisting of a single male member and widows of deceasedJudicial Committee accordingly held that in none of the six appeals before them could the income falling to be shares of the partners of a registered firm be treated as income of a Hindu undivided family and assessed on that footing. In the view of the Judicial Committee, income received by four out of the six partners was their separate income: in the case of the remaining two partners the income was from sources which were ancestral. But merely because the source was held by a member who had received it from his father and was on that account ancestral, the income could not be deemed for purposes of assessment to be income of a Hindu undivided family, even though Kanji had a wife and a daughter, and Sewdas had a wife who had rights to be maintained under the Hinduof a joint family therefore does not cease to belong to the family merely because the family is represented by a single coparcener who possesses rights which an owner of property may possess. In the case in hand the property which yielded the income originally belonged to a Hindu undivided family. On the death of Buddappa, the family which included a widow and females born in the family was represented by Buddanna alone, but the property still continued to belong to that undivided family and income received therefrom was taxable as income of the Hindu undivided family.