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583.
THE OFFICIAL TRUSTEE OF WEST BEN FOR THE TRUST OF CHITRA DASSL ve C..T WEST BENGAL, CALCUTTA December 4, 1973
[A.N. RAY, CJ. H. R. KWANNA K. K. Matucw, A. ALAGIRISWAMI: _AND P. N. BHAGwati, JJ.]
fncome-tax Act (11 of 1922), s. 3— Individual’, if includes a Hindu deity
0a the question whether a Hindu deity is an ‘individual’ within the meuning of. that word under the provisions of the Income tax Act, 1922.
HELD : A Hindu deity falls within the meaning of the word ‘individusl’ jn 5.3 gndcan betreated as 2unitofassessmemt. Itwould naurally be texcd hice gh its shebaits who are iN possession and managemcNt cf its picperty, (S87—C}
As a result of the decision of the Bombay High Court in CL.T.v. Ahmedabad’ Mill Owners, Association, 7 1.T.R. 369 that ‘individual’ in s, 3 of the Inceme tax Aci, . 1922, must mean a human being, the Income-tax (Amendment) Act, 1939,4 mended the words “association of individuals” in the section into “asscciaticn of persons” ;. butthe word ‘individual’, being the first of the six assessable units mentioned 30 the section, was retained and was not amended into ‘person’. It was not changed mo “person” because the word ‘person’ js of wider import ardincludes any ccmpery orgssociation or body of individuals whether incorporated or not. So, a word had to be chosen which would not carry with it the wider import of the word *perscn™ and the word ‘individual’ was retained. After the amendment, it was Fcinted cut by this Court in Commissioner of Income tax ¥. Sodra Devi (32 1.T-R. 615) tbat the word ‘jadividua}” not only means a human being, but also includes @ corporaticn Geated bya statute. A Hindu deity js a juristic person capable of holding pre-- Perty. Asit can hold property and be in receipt of inccme and can also sue ard te sued jD a court of |aw theie is NO reuson why its income should be held to be out-side the ambit of taxation since it can be brought within it without straining the language of the statutory provision, [586E—H; 587B—C] ;
Jogendra Nath Naskar v, Come, of Income-tax (1969) 74, LT.R. 33 (S.C.), followed. Commissioner of Income tax v. Salem District Urban Bank Ltd. 8 ).T.R. 269, o—. -0f Income-tax ¥. Bar Council, ¥2,1.T-R, 1, Sir Currimbhay Ebrahim Baronetcy rust v. Conunr. of Income-tax, 5, 1.7, 484, referred to.
‘ LTC. v. Jogendea Nath, A.J.R. 1965 Cal, 570 and Sri Sridhar v. LT. Officer. -LR. 1966 Cal, 494, approved, —2366
Ciwit Aperutate Jurispicrion : Civil Appeals Nos. 2358 of 1968 & 1174, 1288—1299 of 1971.
From the judy F ‘ m + 4tb January, 1966 of the : ’ yment and Order dated the 4th January, Calcutta High Court in Income Tux Reference No. 25 of 1968.
“ yfurshotham Chatterjee, P. K. Chakravarthy and Prodyot *avarthy', for the appellant,
¥.S. Desai, $. KA iver and R. N. Sachthey, for the respondent.
The Judgment of the Court was delivered by
Auacirisy, A es for decision in these” a IRISWAMI, J. The question that arises for Cce : otthat 'S Whether a Hindu deity is an “individual” within the meaning .
> W ary M “tax Act 1922. Ord under the provisions of the Indian Income ain 8 sumber arises 9 “att of Ut of the judgment of the High Court of Calcut 5 the qerences inde mH 66(1) of te Act. The facts necessary 1 “SiON, in a short compass, are these : In the year 182
Kumar’
584 SUPREME COURT REPORTS [1974] 2 CR,
‘Chitra Dassi executed an Ekrarnama making a gift of a pj for religious purposes. In 1842 she executed a will reikirine ie e land that she had earlier made the property debutter and directed her fon sons, the executors, to perform the daily service of Sri Radhagobind= “She died in 1855, In 1876 a suit was filed in the Calcutta High Co praying that the trust should be administered by the court and a sch nd prepared. Subsequently, there were a number of applications ue ‘from time to time and a number of orders were also made on the In 1929 a scheme of administration was framed and a little later be ‘Official Trustee of Bengal was appointed to be the trustee of the said debutter estate. After the official trustee took possession of the properties he was assessed in respect of the income of the debuatter estate in the status of an “individual” under section 41 of the Act. In respect of the assessment years 1939-40 to 1942-43 a reference was made under section 66(2) of the Act. A Bench of the Calcutta High Court held that upon a proper construction of the relevant ‘documents andthe scheme sanctioned and orders passed by the High Court the property should be held to be a religious trust. The matter again went up to the High Court in respect of the assessment years 1943-44 to 1951-52. Three questions finally came to be considered by the High Court : 5
Q.1 Whether upon a proper construction of the relevant documents executed by Smt. Chitra Dassi and the relevant schemes sanctioned and orders passed by the High Court, there was a trust in favour of the Deity or whether there was a dedication of the properties to the Deity ?
Q.2 Alternatively, if the dedication to the Thakur constitute trust, is it a religious trust which did not enure to the benefit of the public ?
Q.3 Isthe Thakur Radha Gobinda Jew liable to assess ment under the Indian Income-tax Act ?
On question No.1 the High Court beld that upon a propet oie Tuclion of the relevant documents executed by Chitra Dasst ar aft televant Schemes sanctioned and orders passed by the High me there Was a dedication of the properties to the deity, but that eae NO trust in the technical sense, that is to say, as understood ia ies English law. In respect of the first part of the 2ud question both parte before the High Court agteed that in that question the word a xf ‘did notmean a trust in the technical or the English sense. ate st i ‘Court pointed out that it has been held that a dedication is 4 we the general sense within the meaning of the expression as a can “sections 4, 40 and 41 of the Income-tax Act and the word fiat stion be applied to Hindu endowments, On the second part of the ae docl sit was held that the endowment is a private religious trust and the of ments creating it or confirming it grant no benelit to the MEM” yi the public, that an order made by the Calcutta High Court by
Sf ew ore
= 7 opgICIAL TRUSTEE Vv. C.-T. (Alagiriswami, J.)
«, directions were given for feeding the poor, wa r
A cet ha benefit enured to the public. As tegards bs way Ly ie High Court elaborately discussed whether the deity could be ber oo teal “individual” and held that the deity was liable to assessment under the Income-tax Act.
‘ore this Court the only point argued was whether t i is Pe com right in coming to the conclusion that the deity is an “ini dual”. When the High Court deait with this question it did not have the benefit of the decision of this Court in Jogendra Nath Naskar y.
Commr. of Income-tax (1969-74 ITR 33) wherein it was held that a
Hindu deity falls within the meaning of the word “individual” Sen tjon 3 and can be treated as a unit of assessment. Mr. Chatterjee argu- ing for the appellant urged that that decision was wrong and should
C be reconsidered. We find ourselves in entire agreement with the deci- sion of this Court referred to above. We shall, however, state our reasons within a short compass, it was conceded before us on behalf of the appellant that if the word used had been a “person” instead of an “individual” the deity would be a person because a person will include a juristic person. That D aHindu deity is a juristic person is a well established proposition and bas been so for a long time. In Mfaharanee Shibessouree Debia v. Mothooranath Acharjo (1869 13 MIA 270) it was observed ;
“The Talvok itself, with which these Jimunas were connected by tenure, was dedicated to the religious services of the Idol. The rents constituted, therefore, in legal con- E templation, its property. The Sabait had not the legal property, but only the title of Manager of a religious endowment.” 5
In Prosunno Kumari Debya v. Golab Chand Baboo (1875 LR 2 IA. 1145) the above observations were cited with approval. In Afanohar Ganesh v. Lakhmiram (1887 ILR 12‘Bom. 247) a Division Bench off the Bombay High Court observed :
“The Hindu law, like the Roman law and those derived from it, recognises, not only corporate bodies with rights of property vested in the corporation apart from its indivi- ual members, but also the juridical persons or subjects 6 called foundations..,...it is consistent with the grants having been made to the juridical person symbolized or Personified in the idol...,..”
Tithe, Swami (1904 ILR 27 Mad. 435) expressed the view :
“Itis to give due effect to such a sentiment, widespread
. and deeprooted as it has always been, with teference te
Something not capable of holding property as hers Petson, that the laws of most countries have <a implied € creation of a fictitious person inthe matter, a8!
The Madras High Court in Vidyapurna Tirtha Swami V. Vidyanidhi:
" ae
*586 SUPREME COURT REPORTS {1974} 2 S.CR in the felicitous observation made in the work already cited ‘Perhaps the oldest of all juristic persons is the God, here or the saint.”
In Pramatha Nath Mullick v. Pradyumna Kumar Mullick (1925 LR 252 IA 245 ; AIR 1925 PC 139) the Privy Council observed :
“A Hindi idolis, according to long established authority founded upon the religious customs of the Hindus, and the recognition thereof by courts of law, a ‘juristic entity’. It has a juridical status with the power of suing and being sued. Its interests are attended to by the person who has the deity in his charge and who is in Jaw its manager with all the powers which would, in such circumstances, on analogy, be given to the manager of the estate of an infant heir. It is unnecessary to quote the authorities ; for this doctrine, thus simply stated, is firmly established.”
The authorities thus amply establish that a Hinchr deity is a juristic ‘person capable of holding property. :
Reference was made to the decision in C. L. T. v. Alunedabad Milt -Ouners’ Association (7 ITR 369) where Beaumont, C. J. held :
“Individual” where first used, must mean human being, because it is used as something distinct from a joint family, firm and company. The whole expression seems to me to mean “every human being, Hindu undivided family, company, firm and other association of human beings.”
‘Though in consequence of this decision the Income-lax (Amendment) Act, 1939 amended the words “association of individuals” into “association of persons”. the word “individual” being first of the six assessable unils mentioned in section 3 was retained and was not amended into “person”. {t could not be changed into “person” for the obvious ‘reason that the word “person” is of wider import and includes any company or association or body of individuals, whether incorporated or not, So a word had to be chosen, which would not carry with it the wider import of the word “person” and the word “individual” appears to have been chosen, In Conmnissioner of Jncome-tax ¥. Sodra Devi (32 JTR 615) it was pointed out that the word “individual” not -only means a human being but also includes a corporation created by a statule,e. g.a University, or a Bar Council or the trustees of 2 Baronetcy trust, incorporated by a Baronetcy Act (See the decisions in Conmissioner of Income-tax v. Salem District Urban Bank Lid. 8 LTR 269 > Conmissioner of Inconwe-tax v. Bur Council, 12ITRI; and Sir Currimbhoy Ebrehim Buronetey Trust vy. Commit ssfoner of Income-tux, 5 JTC 484), But Dass 5, observed : :
Ty ‘ s Ss a seeeesthere is no difficulty whatsoever in my opinion, in giving the word ‘individual’ its natural meaning, that is, that the word means cither a male or a female,”
But the court in that Case Was Not concerned with the problem whether the word “individual” can refer 10 a juridical entity, Mukharji J. ©
Sai, é ri
«,
OFFICIAL TRUSTEE v. C-1.T. (Alagiriswami, J.) 587 the Calcutta High Court in J. 7. Comm, v. Jogendra Nath (AIR 1965 Cal. 570) held that a Hindu deity can be either an individual or a person or both. The same High Court in Sri Sridhar v. I. T. Officer (AIR 1966 Cal. 494) held that a Hindu idol is a iuristic entity who is given the status of a human being capable of having property and it can be called an “individual”.
We are of opinion that as a Hindu deity can hold property and be in receipt of income and can also sue and bé sued in a court of law there is no reason why its income should be held to be outside the ambit of taxation if it can be brought within it without straining the language of the statutory provision. It would naturalty be taxed through its shebaits who are in possession and management of its property. We may, however, mention that the problem whether the Hindu deity is an individual is not likely to arise after the enactment of Income-tax Act, 1961 which in clause 31 of section 2 defines a “person” as including (i) an individual, (ii) a Hindu undivided family. (iii) a company, (iv) a firm, (v) an association of persons or a body of individuals, whether incorporated or not, (vi) a local authority. and (vii) every artificial’ juridical person, not falling within any of the preceding sub-clauses.
The appeals are dismissed with costs.
V.PS Appeals dismissed.