SIKRI, J. - (1.) THE following Judgment of the court was delivered by:
(2.) THIS appeal, by certificate of the High courtof Madras, is directed against its judgment in a referencemade to it under S. 66(1) of the Indian Income Tax Act,1922, hereinafter referred to as the Act, by the Income TaxAppellate tribunal, Madras. The question referred to was'whether the assessment of the income of the assessee, otherthan his salary in the hands of the assessee, as anindividual and not as a Hindu undivided family till 1 1/12/1952, for the assessment year 1953-54 is valid. The question arose out of the following facts. Theappellant, hereinafter referred to as the assessee, is theyoungest son of T. V. Sundaram Ayyangar, who was the Kartaof a Hindu undivided family consisting of a number ofpersons. There was a partial partition of the above familyand 150 shares of Rs. 1,000.00 each in T. V. Sundaram Iyengarand sons Limited, a private limited company, were dividedequally among the coparceners, the assessee getting 25shares of the value of 25,000. With the aforesaid shares asnucleus, the assessee acquired houseproperties, shares anddeposits up to 31/03/1952. As the assessee was also theService Manager of the aforesaid private limited company, healso received substantial remuneration. The first son, named Venugopal, was born to the assesseeon 11/12/1952, and it is common ground that theconception of the child must have taken place sometime inMarch, 1952. For the assessment year 1952-53, the assessee wasassessed as an individual with reference to all his sourcesof income. For the assessment year 1953-54 (accounting yearApril 1, 195 2/03/1953) the assessee claimed thatincome from all sources, except salary, should be assessedin the hands of H.U.F., consisting of himself and his sonVenugopal, which according to him had come into existence inor about March 1-952 when Venugopal was conceived. The Income Tax Officer, while admitting that a malechild acquires coparcenary rights in the family even fromthe date of his conception, considered that this propositionapplied only as far as the minor's rights inter se othermembers were concerned, and as far as the claims of theState or outsiders were concerned, he thought that an unbornson would not come into the picture. 'therefore, herecognised the family only from the date of the birth of thechild, viz., 11/12/1952. The Appellate AssistantCommissioner upheld his view and the assessee also failedbefore the Appellate tribunal. The High court answered thequestion against the assessee.
(3.) MR. A. V. Viswanatha Sastri, the learned counsel forthe assessee, contends that under the Act Hindu undividedfamily is a separate unit and in determining whether a Hinduundivided family exists or not, and if it exists, from whatdate it has come into being, regard must be had to theprinciples of Hindu Law for the Act does not lay down anyprinciples regarding this matter. He then urges that it iswell-settled that according to Hindu Law, a son conceivedhas the same rights of property as a living son, and thisrule, he says, is not a matter of fiction but a substantiverule of Hindu Law. He further says that it is wellsettledaccording to Hindu Law that joint Hindu family comes intoexistence from the date a son is conceived, and as in thiscase the son was conceived in March 1952, the Hinduundivided family was in existence from the beginning of theaccounting year 1952-53. The learned Attorney-General, who appears on behalf ofthe Revenue, does not dispute the existence of the doctrineof Hindu Law relied on by Mr. Sastri, but says that thisdoctrine applies only for a special purpose,, the purposebeing to safeguard the rights of the son to property, andthat Hindu Law itself recognises that this doctrine is notof universal application. He urges, in the alternative,that at any rate the Act is concerned with realities; underthe Act the person to whom income accrues must be a visiblereality, and, he says, the only visible person who existedup to 11/12/1952, was the assessee. He further saysthat we would be introducing anomalies in the working of theAct if this fiction is applied to the instant case. Inaddition he relies on the form of return of income tax whichhe says would be difficult to fill if the return is filedbefore the birth of the son. In C. B. C. Deshmukh v. l. Mallappa Chahbasappa(1) thisCourt 'had occasion to consider the scope of the doctrinethatunder Hindu Law a son conceived or in his mother's womb isequal in many respects to a son actually in existence in thematter of inheritance, partition, survivorship and the rightto impeach an alienation made by his father. But this courtrefused to extend it to adoption. Subba Rao, J., speakingfor the court,observed But there is an essential distinction between an alienation, partition and inheritance on the one hand and adoption on the other : his right to set aside an alienation hinges on his secular right to secure his share in the property belonging to the family, as he has a right by birth in the joint family property and transactions effected by the father in excess of his power when he was in the embryo are voidable at his instance; but, in the case of adoption, it secures mainly spiritual benefit to the father and the power to adopt is conferred on him to achieve that object. The doctrine evolved wholly for a secular purpose would be inappropriate to a case of adoption. We should be very reluctant to extend it to adoption, as it would lead to many anomalies and in some events defeat the object of the conferment of the power itself. The scope of the power must be reasonably construed so as to enable the donee of the power to discharge his religious duty. We, therefore, hold that the existence of a son in embryo does not invalidate an adoption. ;