SHELAT - (1.) THIS appeal by certificate, is directed against the judgment of the High Court of Mysore dated 3/02/1967 whereby it answered in the negative the question referred to it under S.64 (1) of the Estate duty Act, XXXIV of 1953. The question was: "Whether on the facts and in the circumstances of the case, the entire property held by the deceased valued at Rs.12,23,794.00 was chargeable to estate duty?" The said property comprised shares and securities of the value of Rupees 25,778/-, and immovable properties at Bangalore and Madras respectively valued at Rs.5,42,500.00 and Rupees 6,10,100/-.
(2.) THE assessment in question pertained to the estate of Hajee Mahomed Hussain Sait, the father of the two respondents, who died at Bangalore on 22/03/1955 leaving the said properties. THE said Hajee Mahomed Hussain and the respondents belonged to Cutchi Memon sect amongst the Muslims. THE respondents claimed that Cutchi Memons at one time were Hindus residing in Sind, that some four or five hundred years ago they were converted to Islam like the members of another such sect, the Khojas, that they migrated thence to Cutch and from there spread themselves to Bombay, Madras and other places. THEir case was that despite their conversion, the Cutchi Memons retained a large part of Hindu law as their customary law including its concepts of joint family property, the right of a son by birth in such property and its devolution by survivorship. Further, neither the Cutchi Memons Act, XLVI of 1920, nor the Muslim Personal Law (Shariat) Application Act, XXVI of 1937, nor the Cutchi Memons Act, X of 1938 applied to them. That being the position, there was no question of the passing of the said properties to them on the death of their father as envisaged by S.3 of the Act or its being applicable to them or the said properties, the said properties having come to them under the Hindu law rule of devolution of joint family property by survivorship. THEir case was that only one third of the said properties, that is, the undivided share of their deceased father, could be properly said to have passed to them on his death and to be assessable under the Act. The Deputy Controller rejected these contentions as also the evidence led by the respondents in support thereof and assessed duty at Rs.2,05,996.41 P. on the basis that the entire estate valued by him at Rs.12,23,794.00 was assessable. The respondents filed two separate appeals, both of which were rejected by the Central Board of Revenue by its order dated 30/12/1961, and as aforesaid, at the instance of the respondents referred to the High Court the aforesaid question. In support of their contentions, the respondents had produced before the Deputy Controller the following documents as evidence of the Hindu law being their customary law: JUDGEMENT_350_2_1972Html1.htm (vi) The Judgments of the same High Court in Siddick Hajee Aboo Bucker Sait v. Ebrahim hajee, Aboo Bucker Sait, AIR 1921 Mad 571 and Abdul Sattar Ismail v. Abdul Hamid Said. AIR 1944 Mad 504. These were produced to show that the rules of Hindu law were consistently acquiesced in and applied to their family and the other Cutchi Memons settled in Madras. They also relied on the fact that the High Court had issued letters of administration to them although they had paid succession duty only on one third of the said estate. The Deputy Controller held that neither the said evidence, nor the fact of their having paid succession duty on one third of the said estate only concluded the issue before him, viz., that the rules of Hindu law, including the rules as to joint family property and its devolution by survivorship constituted the customary law of Cutchi Memons in Madras and Bangalore. He rejected their contention that as they had settled down first in Madras and then in Bangalore sometime between 1928 and 1930, and as a large part of the estate was situate in Madras, he should prefer the Madras as against the Bombay view, namely, that the rules of Hindu law applicable to Cutchi Memons governed matters of succession and inheritance only. His view was that as there was only one solitary decision of the High Court of Madras in favour of the respondents' contentions as against a large number of decisions of the Bombay High Court which limited the application of Hindu law to matters of succession and inheritance, the Bombay view was the correct one. As regards the orders and decisions produced by the respondents, he held that they would not assist the respondents as in none of them the question raised by them was specifically dealt with by the High Court.
(3.) IN support of their appeals the respondents, in addition to the aforesaid evidence, also produced a partition deed of 1906 between one Hussain Hajee Ouseph Sait and his two sons, which inter alia recited that the said Hajee Hussain Sait and his six brothers had formed a joint family governed by Hindu law. The different petitions and the orders thereon set out earlier, and ranging from 1909 to 1930 showed, (1) that the respondents' family was in Madras till about 1930 when its members partly shifted their activities to Bangalore, and (2) that in all those petitions the stand taken by the members of the respondents' family was that the family properties were treated as joint family properties. The Board, however, rejected this evidence stating that no weight could be given to it, since a custom followed by one particular family would not "convert that family into a coparcenary governed by the Hindu law of survivorship", and dismissed the appeals. As aforesaid, the High Court upheld the respondents' contentions and answered the question referred to it against the Revenue. On behalf of the Controller of Estate Duty, the following points were raised: (i) that the concept of joint family did not apply to Cutchi Memons, and that a Cutchi Memon's son did not acquire any interest by birth in the property inherited by his father from his ancestors. (ii) that in any case there was no scope for raising any such contention after the enactment of the Shariat Act of 1937, and thereafter of the Cutchi Memons Act, 1938, (iii) that the High Court of Mysore should have preferred the view taken by the Bombay High Court and followed by the old Mysore High Court in Elia Sait v. Dharayya, (1932) 10 Mys LJ 33 and (iv) that the findings recorded by the Board were binding on the High Court. After some argument, Mr. Desai conceded that his contention as to the Shariat Act could not be pressed and gave up that part of his second proposition. As regards is 4th proposition, the issues before the High Court were questions of law and therefore there was no question of the High Court being bound by the Board's findings. That leaves proposition 1, part of proposition 2 and proposition 3 of Mr. Desai for our determination. ;