April21.

SUPREME COURT REPORTS [1960]

SAHEBZADA MOHAMMAD KAM GAR SHAH

JAGDISH CHANDRA DEO DHABAL DEO

AND OTHERS. (P. B. GAJENDRAGADKAR, K. N. WANCHOO and

K. C. DAS GUPTA, JJ.)

Document-Construction of-Discrepancy between earlier and later parts-"Duly authorised"~ meaning of-Indian Limitation Act, 1908 (IX of 1908), Explanation II, s. 19.

In 1900 the then proprietor of the Dhalbhum estate who was the predecessor-in-interest of the first respondent granted a permanent lease of the mining rights for certain metals and minerals in the estate to one Prince Mohammad Bakhtyar Shah.

During the lifetime of the said proprietor the management of the estate was taken over by the Deputy Commission of Singhbhum under the Chotanagpur Encumbered Estates Act and after the former's death the manager of the Estate granted to the Official Receiver to the estate of Prince Mohammad Bakhtyar Shah another lease in respect of mining rights in the same area in 1919.

The first respondent commenced the present litigation for the purpose of recovering rents and royalties on the basis of the second lease from the heirs and representatives of the estate of Prince Mohammad Bakhtyar Shah and also from the appellant as the Receiver to that Estate. The decision of the case depended upon the construction of the two leases of 1900 and 1919 and the Trial Court aod the High Court decided the case in favour of the plaintiff respondents.

On appeal by the contesting defendant appellant on a certificate granted by the High Court: Held, that the intention of the parties to a dispositive document must be gathered from the words used by the parties themselves and they must be presumed to have used the words in their strict grammatical sense.

If the st:itements made in the earlier part of the document were irreconcilable with those made in - the later part, the earlier part must prevail.

In cases of ambiguity the court should look at all the parts of the document to ascertain the intention of the parties.

If ambiguity still remains, the Court should interpret the document strictly against the grantor and n favour of the grantee.

Under Exp. II of s. 19 of the Limitation Act the words "duly authorised" would include duly authorised either by the action of the party indebted or by force of law or order of the court.

Annapagonda v. Sangadiappa, (1901) Born. L.R. 221 (F.B.), Rashbehari v. Anand Ram, 43 Cal. 211, Ramcharan Das v. Gaya Prasad, 30 All. 422, Lakshmanan v. Sadayappa, A.LR. 1919 Mad 816 and Thankamma v. Kunhamma, A.I.R. 1919 Mad. 370, approved.

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Currimbhai v. Ahmedali, 58 Born. 505 and Lakshmanan Chetty v. Sadayappa Chetty, 35 M.L.J. 571, considered.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 81 of 1956.

Appeal from the judgment and decree dated September 24, 1952, of the Patna High Court in First Appeal from Original Decree No. 2 of 1947, arising out of the judgment and decr'ee dated August 31, 1946, of the Special Subordinate Judge, Chaibassa, in Money

Suit No. 3 of 1941.

L. K. ]ha, B. K. Saran, S. T. Husain, S. K. ]ha and K. L. Mehta, for the appellant.

H. N. Sanyal, Additional Solicitor-General of India ]. C. Das Gupta and R. C. Prasad, for respondent No. I.

1960. April 21.

The Judgment of the Court was delivered by DAs GUPTA. T .- Dhalbhum estate which covers an area of more than 1,000 sq. miles and Iles partly in the District of Midnapur and partly in the District of Singhbhum is rich in minerals.

In 1900 the then Proprietor of this estate Raja Satrughan Deo Dhabal Deo the predecessor-in-interest of the first respondent Jagdish Deo Dhabal Deo granted permanent lease of the mining rights for certain. metals and minerals in this estate to Prince Mohammad Bakhtyar Shah of Tollygunge in the District of 24-Parganas.

Raja Sa"trughan Deo Dhabal Deo died in 1916.

Before his death, however, the management of the estate had been taken over by the Deputy Commissioner of Singhbhum under the Chotanagpur Encumbered Estates Act.

In the course of such management the Manager of the Estate granted on September 1, 1919, to the Official Receiver to the estate of Prince Mohammad Bakhtyar Shah another lease in respect of mining rights in the same area.

The present litigation was

commnced by the first respondent with ii view to recover rents and royalties on the basis of the second lease . from the heirs and representatives of the es, tate of

Prince Mohammad Bakhtyar Shah and also from the present appellant as Receiver to that estate.

As under the terms of the lease the lessor is entitled to the half

15-6 SCI/ND/82

Saheb.zada Mohammad Kamgar ShDh

. v . .

Jagdish Chandr11

Deo Dhabal D•o

Das Gup111 J.

Saheb;:ada Mohammad Kamgar Shah

v. :Jagdish Chandra

Deo Dhabal Deo

Das Gupta J.

SUPR~ME COURT REPORTS [1960]

share of the receipts on account of rents and royalties and other incomes in respect of the minerals demised and the exact income could not be known until accounts were furnished by the lessee, the defendant prayed for a decree for accounts from .January I, 1926, and for a decree for the sum found due on such accounts.

As the suit was brought on August 12, 1941, the period prior to August 12, 1935, would prima facie be barred by limitation.

According to the plaintiff, limitation was saved by the acknowledgments that had been made from time to time by the then Receiver of the estate .. ·

Two defences were raised by the Receiver who was the only contesting defendant.

The first was that the lessor had dispossessed him from part of the leasehold property and so there ought to be total suspension of rents and royalties. The second defence was as regards the claim for the period prior to August 12. 1935. It was pleaded that the letters which are claimed to have acknowledged the liability did not in law amount to acknowledgement of liability and that in any case the alleged acknowledgements being by the Receiver who was an agent of the court and not an agent of the parties the acknowledgments would be of no avail in saving limitation.

Though the written statement itself did not in terms mention the nature of the lessee's dispossession frorn the leasehold property the definite case at the trial was that this dispossession was in respect of minerals which had been specifically excluded from the earlier lease of 1900 but according to the defendant included in the later lease.

One of the main questions in the appeal is whether the minerals specifically excluded in cl. 16 of the earlier lease were demised to the lessee by the later lease of 1919.

Of the several issues that have been framed we are therefore concerned now only with the two issues in respect of these two defences.

The first of these is: "Is the defendant entitled to suspension of rents and royalties as claimed"; the second is: "Is any portion of the plaintiff's claim barred by limitation?" The Subordinate Judge held on a construction of the lease of 1919 that it did not include minerals specifically excluded by cl. 16 of the earlier lease and as the only

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case of dispossession from leasehold property was made in respect of these minerals the plea of suspension of rent must fail.

He also negatived the plea of limitation, being of opinion that the Official Receiver was competent to make such acknowledgments and that in fact there were acknowledgments of the plaintiff's liability within the meaning of s. 19 of the Limitation Act. vVith regard to the period from 1935 to 1941, regarding which no question of limitation arose, the Subordinate Judge gave a decree of rendition of accounts and for payment of such amounts as would be found on accounting by the Commissioner.

On the basis of his finding that there was an acknowledgment of liability to the extent of Rs. 67,459-3-3 as due under the terms of the two leases up to the year 1935 but that there was no material on the record to find out as to what was the amount due up to that year on the basis of that second lease, he made an order in the following terms:

"The defendant is hereby directed to assess and state the amount due under the lease in suit out of the said sum of Rs. 67,459-3-3 on the basis of the accounts of his office ..... .in respect of the plaintiff's dues within two months from this date, failing which a commissioner will be appointed fo make accounts and ascertain the amount due to the plain.tiff, and the defendant shall be liable for the costs of the same." Against this decree the contesting defendant, the Receiver appealed to the High Court of Judicature at Patna.

Before the appeal court two points were raised.

The first was that on a proper construction of the 1919 lease it should be found that the minerals specifically excluded in clause 16 of the earlier lease were included in the 1919 lease and consequently, the lessor having granted certain leases to other parties in respect of these minerals in the area the lessee was entitled to suspension of rents. The other point raised was that in law there was no acknowledgment which could save limitation in respect of the claim prior to August 12, 1935.

.Sahebzada Mohammad Kamgar .Shah

Jagdish Chandra

Deo Dhabal Deo

Das Gupta].

Sahebzada Mohammad _ Kamgar Shah

Jagdish Chandra

D10 Dhabal Do

Das Gupta J.

On both these points, the learned judges of the Patna High Court who heard the appeal agreed with the conclusions of the Trial Judge. On the first point they held that the minerals excluded by clause 16 of the 1900 lease were not included in the second lease and so there was no question of any suspension of rents.

They also held that quite apart from the question of construction of the document, the lessee was not entitled to suspension of rents as in order to justify. withholding of the rents, the act of the landlord must be forcible or, at any rate, tortious and that these conditions had not been established in the present case.

On the second question, the learned judges held that the letters on which the plaintiff relied to show acknowledgments by the Receiver did in law amount to acknowledgments and the acknowledgments being by the Receiver who was himself bound to pay the rent due to the superior landlord were good acknowledgments within the meaning of s. 19 of the Limitation Act.

Accordingly they dismissed the appeal.

The present appeal has been brought by the contesting defendant the Receiver on a certificate given by the High Court under Art. 133 of the Constitution.

Both the defences raised in the court of appeal have been pressed before us.

The alleged dispossession on the basis of which the first defence of a right to suspension of rent is urged is only in espect of minerals mentioned specifically in clause 16 of the earlier lease of 1900.

It is necessary therefore to decide in the first place whether these minerals mentioned in clause 16 of the earlier lease have been included in the second lease.

If as found by the courts below they have not been so included no question of suspension will arise. If they have been included, some other questions of law and fact may have to be considered in deciding whether the defendant's plea of suspension of rent can succeed.

While primarily we have to construe the 1919 lease to find an answer to the question indicated above, it will be necessary for that very purpose to refer to several portions of the earlier lease of 1900.

The very first clause in the operative portion of the 1900 lease is in these words : -

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"That you shall prospect, raise, purify, melt and sell gold, silver, copper, lead, zinc, iron, mercury, mica, sulphur, copper sulphate, coal, chalk, redearth, etc., mati slate stone and all kinds of precious stones such as diamond, ruby, emerald, topaz, crystals, etc., lying on the surface and subsoil of Ghatsila otherwise called pargana Dhalbhum, mentioned in the Schedule excluding the 2 mouzas Narsinghgarh and Ghatsila and the Dibkulis mentioned in Schedule below." It will be noticed that this clause does not mention stones, lime-stones, ghuting or ballasts. Clause 6 of the lease however provided that the lessee shall be "competent to take stones, lime-stones, ghuting and ballast which may be required for constructing buildings, bungalows and pathways, etc., necessary for the aforesaid mining work free of cost and rent." Clause 16 of the lease contains some further provisions as regards these and is in these words :-

"That by virtue of the aforesaid patta, you shall not be competent to offer any obstruction either to me or to my any authorised person to raise stones

(used) for utensils or stones, lime-stone and ghuting,, etc., for buildings which are not covered by this patta and sell the same to me or to tenants, etc., under me to dig bandh, tank, canal and wells, etc., but the terms of the said patta shall hold good in respect of the underground minerals, etc., lying under the said wells, etc." Two things that are abundantly clear from this document are:-(1) that the mining rights were specifically granted in respect of gold, silver, copper, lead zinc, iron, mercury, mica, sulphur, copper sulphate, coal, chalk, red-earth and certain precious stones such as diamond, ruby, emerald, topaz, crystals, etc., and (2) that stones for utensils or stones, lime-stones, ghuting, etc., and ballast for buildings were specifically excluded from the lease.

By the later lease of 1919 the lessor gave and the lessee obtained mining rights in respect of certain minerals not granted by the earlier lease. The question is whether what was granted by the later lease included in addition to things which had not been specifically named in the earlier grant also things which

Sahebzada Mohammad Kamgar Shah . v.

Jagdish Chandra Deo D habal Deo

Das Gupta J.

Sahebzada Mohammad Kamgar Shah

Jagdish Chandra

/J4o D habal Deo

Dos Gupta].

had been specifically excluded there.

The important portion of the operative clause of the later lease is in these words:-

"In consideration of the rent hereby reserved and of the covenants and conditions hereinafter contained the Manager hereby grants demised unto the Receiver all and singular all metals and minerals of whatsoever kind or description other than those spe- cifically comprised in and granted by the principal lease ............................. . .. .. .. .. .. .. for such purposes to have all and every the rights, privileges and powers comprised in and granted to the said Prince Mohammad Bakhtyar Shah by the said principal lease in all respects as though the same were repeated herein so far as they do not contradict any of the provisions herein contained and are still existing and capable of taking effect."

The covenant runs thus:- "Receiver covenants with the Manager that he will at the time and in the manner provided for in the said principal lease pay the rent or royalty reserved hereby and will carry out and comply with all the provisions and conditions comprised in the 4 said principal lease so far as they are applicable to these presents in the same manner as though they had been inserted herein." The document contains next an agreement that the Receiver shall be at liberty to grant under-leases subject to certain conditions and provisions.

One of the conditions mentioned is:-"That all such underleases shall be subject to such special terms in regard to specific minerals as may be prescribed from time to time by the Government Rules relating to Mining Leases and shall be subject to the provision of clause 16 of the said principal lease."

The lease concluded with the words:- "Provided always and it is hereby agreed that nothing herein contained shall be deemed to show that the Pottah of the tenth day of January one thousand and nine hundred made between Raja Satrughan Deo Dhabal Deo, son of Gopinath. Deo Dhabal Deo, deceased and the Hon'ble Prince

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Mohammad Bakhtyar Shah, son of Prince Mohammad Anwar Shah, deceased is not still valid and subsisting."

In his .attempt to establish that by this later lease the lessor granted a lease even of those minerals which had been excluded specifically by clause 16 of the earlier lease, Mr. .Jha has arrayed in his aid several well established principles of construction.

The first of these is that the intention of the parties to a document of grant must be ascertained first and foremost from the words used in the disposition clause, understanding the words used in their strict, natural grammatical sense and that once the intention can be clearly understood from the words in the disposition clause thus interpreted it is no business of the courts to examine what the parties may have said in other portions of the document. Next it is urged that if it does appear that the later clauses of the document purport to restrict or cut down in any way the effect of the earlier clause disposing of property the earlier clause must prevail.

Thirdly it is said that if there be any ambiguity in the disposition clause taken by itself, the benefit .of that ambiguity must be given to the grantee, the rule being that all documents of grants must be interpreted strictly as against the grantor.

Lastly it was urged that where the operative portion of the document can be interpreted without the aid of the preamble, the preamble ought not and must not be looked into.

The correctness of these principles is too well established by authorities to justify any detailed discussion.

The task being to ascertain the intention of the parties, the cases have laid down that that intention has to be gathered by the words used by the parties themselves.

In doing so the parties must be presumed to h<_ive used the words in their strict grammatical sense. If and when the parties have first expressed themselves in one way and then go on saying something, which is irreconcilable with what has gone before, the courts have evolved the principle on the theory that what once had been granted cannot next be taken away, that the clear disposition by an earlier clause will not be allowed to be cut down by a later

Sahebzada Mohammad Kamgar Shah

Jagdish Chandra

Deo Dhabal Dto

Das Gupta J.

Sahebz:ada Mohamm'ad Kamgar Shah

Jagdish Chanrka

Deo Dhabal Deo

Das Gupta J.

clause. where there is ambiguity it is the duty of the Court to look at all the parts of the documents to ascertain what was really intended by the parties. But even here the rule has to be borne in mind that the document being the grantor"s document it has to be interpreted strictly against him and in favour of the grantee.

Bearing these principles in mind we shall now examine the 1919 lease to perform this task of ascertaining the intention of the parties as to what was being granted by this lease.

The disposition clause as has alreadv been set out is in these words:-"The Manag-er herby grants demised unto the Receiver all and singular all metals and minerals of whatsoever kind or description other than those specifically comprised in and granted by the principal lease." On behalf of the appellant it is argued that if the totality of metals and minerals in the area is denoted by the symbol "X" and what was granted by the earlier lease is denoted by the symbol "Y" the intention of the parties in using the words set out above was that this lease should be in respect of "X" minus "Y". We are afraid however that this is an over-simplification of the problem which we must resist. while it is true that strict g-rammatical sense of the words must be given effect to, words and phrases are not used by people always and invariably in the same sense.

As has often been emphasised by eminent judges the intention of persons using certain words cannot be discovered by considering the words in the abstract.

When in th is lease the grantor used certain words, what we cannot ignore is that when words set out above were used in the present lease both the parties had present in their minds the fact of the principal lease.

They were not only well aware of the fact of the earlier lease but actually referred to it as the principal lease and repeatedly emphasised the fact that the terms and conditions of the principal lease in so far as not contradicted by the present lease would remain valid and effective.

One of the principal facts of that earlier lease is that while some metals and minerals were specifically grantee\ thereby some were specifically excluded.

In interpreting the words of

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the disposition clause we have to take notice of the fact that no reference is being made to that fact of specific exclusion. The question that arises for determination is whether by this omission to make a specific reference to the exclusion clause of the previous lease the parties intended that the exclusion clause will have no effect.

The appellant's argument is that the necessary result of the words \'grants demised unto t.he Receiver all and singular all metals and minerals of whatsoever kind or description other than specifically comprised in and g-ranted by the principal lease" is that the exclusion clause of the earlier lease was itself being excluded.

While there is some scope for that interpretation. if we do not look further. we are unable to agree with the learned Advocate that it is clear and uambiguous that by this reference to the granting clause of. the earlier lease and the words used in respect thereof. the exclusion clause of the earlier lase was being necessarily excluded. There is in our opinion as much scope for arguing that the exclusion clause not being in terms referred to would remain valid and active as there is for the appellant's argument that the words used show an intention to exclude the exclusion clause itself.

In cases of ambiguity it is necessary and proper that the court whose task is to construe the document should examine the several parts of the document in order to ascertain what was really intended by the parties.

In this much assistance can be derived from the fourth condition of the conditions which were imposed by the lease as regards the grant of sub-leases.

This condition provided inter-alia that all such under-leases to be granted by the lessee shall be subject to the provisions of clause 16 of the principal lease. In other words, the sub-lessees shall not be competent to offer any obstruction to the head lessor or to any other person authorised by him to raise stone for utensils or stones or lime-stone and ghuting, etc., for buildings and in selling the same.

Nor will he be competent to offer any obstruction to any person authorised by the lessor in digging bandh, tank, canal and wells, etc. In terms this is a provision as regards under-leases only. But the question which springs to the mind is : what could be the sense of

16-6 SCI/ND/82

Sahebzada Mohammad Kamgar Shah

Jagdish Chandra

Deo Dhabal Deo

Das Gupta J.

Sahebzada Mohammad Kamgar Shah

Jagdish Chadra Deo Dhabal Deo

Das Gupta J.

such a term being imposed in respect of under-lessees if so long as under-leases were not given, the lessee himself would not be bound by the provisions of clause 16 of the principal lease and would be competent to obstruct the head lessor in the several matters mentioned in clause 16?

It is in our opinion unthinkable that such a clause as this fourth clause would be included in respect of sub-leases unless it was also the intention of the parties that the lessee himself would be bound by the provisions of cl. 16 of the principal lease.

The view that this must have been the intention is strengthened by the concluding words of this lease which provide in substance that notwithstanding anything in the later lease the principal lease would be valid and subsisting.

Here also there would be no point in saying that the principal lease would be valid and subsisting as regards merely the minerals which had been specifically granted by the principal lease.

As regards the principal lease being binding in respect of those minerals, there could be no doubt whatsoever and the concluding clause of the 1919 lease would be unnecessary and meaningless.

As regards the metals and minerals which are excluded by cl. 16 there might however be some scope for argument as to what would prevail.

But for some apprehension in the mind of the grantor perhaps on account of clause 6 that there might be some scope of difference as regards the metals and minerals mentioned in cl. 16 of the earlier clause, the inclusion of this clause in the principal lease itself would perhaps be unnecessary.

It was as a safeguard against that uncertainty that the concluding sentence of the later lease uses the words that we find.

It appears to us reasonable therefore to hold that of the two meanings of which the words in the disposition clause are capable the meaning that the parties intended that the minerals excluded by clause 16 of the principal lease were not covered by the present grant but would remain excluded, should be accepted.

We have so long not referred to the preamble of the document.

The relevant portion of the same which is of some assistance in construing the document before us, occurs where the Manager mentions the

consent of the High Court as regards this later lease.

The passage runs thus:-

"Whereas recently certain disputes have arisen betwen the Manager as representing the Estate of the said Sri Sri Satrughna Deo Dhabal Deb, and the Receiver as representing the estate of the said Prince

Mohammad Bakhtyar Shah now deceased with regard to the construction of the principal lease and the minerals comprised therein, and whereas in order to put an end to all such disputes and differences of opinion and for the purpose of preventing litigation and consequent loss of both the said Estates it has been agreed by and between the parties hereto subject to the consent and approval of the said High Court that the Manager shall grant to the Receiver a lease of all minerals other than those specifically mentioned in the said principal lease."

In the judgment of the Trial Court there is a statement that the dispute which had arisen as regards the construction of the principal lease was whether a mineral known as wolfram was included in the lease of

1900 or not.

The correctness of this observation in the Trial Court's judgment based apparently on statements made at the bar has not been disputed before us. If that was the dispute then the object of the second lease was obviously to include therein, in respect of the purposes of the granting clause of the first lease even those minerals which had not been included. That the dispute must have been of the nature, as the Trial Court believes, appears probable also from the use of the words "other than those specifically mentioned" in the preamble. The dispute being on the question of } what was mentioned and what was not mentioned in the granting clause, the object of granting the second lease was that what had not so long been mentioned in the granting clause would also be included in such grant by a supplementary lease. The question of what had been excluded was not in the contemplation of the parties at all. It is significant to note that there was no evidence that before the date of the second lease, any dispute had arisen as regards the operation of the exclusion clause, viz., Clause 16.

A consideration of

Sahebzaha Mohammed Kamgar Mah

Jagdish Chandr~

Deo Dhabal Deo

Das Gupta J.

Sahebzada Mohammed Kamgar Shah

Jagdish Chandra Dto Dhabal Deo

Das Gupta J.

the preamble therefore further strengthens the conclusion that this later lease did not grant any mineral rights in respect of what bad been excluded by the principal lease in its 16th clause.

If we interpret: the disposition clause in the second lease in this way, as we think we must, there is no repugnancy between this clause and the later clauses and there is no scope therefore for the applicability of the doctrine relied on by Mr. Jha that if there be two clauses or parts of a deed one repugnant to the other the first part shall be accepted and the latter rejected.

Nor is there any question in the present case of the words being constructed strictly against the grantor. It is only if the meaning is not otherwise clear that the courts would by recourse to that rule give the grantee something which he might not clearly have received.

As however on a proper construction of the document as a whole we reach the conclusion that the intention of the parties has been clearly established to be that the minerals excluded by clause 16 of the principal lease will remain excluded from the later lease also, there is no scope of any benefit accruing to the lessee by reason of the rule that all deeds are to be construed strictly against the grantor and in favour of the grantee.

We have therefore come to the conclusion that the courts below were right in their conclusion that the minerals mentioned in cl. 16 of the principal lease were not granted. by the later lease also.

The appellant's plea of suspension of rents based as it is on the allegation that the metals and minerals mentioned in cl. 16 of the principal lease were covered by the later lease must therefore fail. We think it unnecessary to consider in this appeal the question whether if the construction which the appellant wanted to place on the document was correct the plea of suspension of rents would have been available to him and we express no opinion on the correctness or otherwise of the views expressed by the High Court as regards the circumstances in which a plea of suspen- .sion of rent can succeed.

There remains for consideration the question of limitation as regards the period of the claim prior to

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August 12, 1935.

On this point the learned counsel for the appellant has advanced a two-fold contention before us.

In the first place he has contended that the alleged acknowledgments were conditional, the condition as stated being that the statements of account enclosed with the letters which are said to constitute the acknowledgments must be accepted as correct.

In support of his argument Mr. Jha drew our attention to the words used in Exhibit 2(1) dated March 7, 1931, which typifies the nature of acknowldegments in the other letters relied on by the plaintiff. This letter addressed by the Official Receiver to Raja J agdish Dea Dhabal Dea is in these words:-

"Sir,

I have the honour to send herewith two statements of account showing an aggregate sum of Rs. 4,993-6-1 as royalty due to the Dhalbhum Raj by the above estate from 1st January to 3 lst December,

1930. On your accepting the statements as correct a cheque for the saicl sum of Rs. 4,993-6-1 will be sent to you.

Besides the above, there is lying to credit of the Dhalbhum Raj the sum of Rs. 31,944-8-3 being the royalty upto the end of December, 1929.

I shall be obliged if you will kindly let me know whether you are prepared to accept the same and on hearing from you I shall be glad to forward to you a cheque in payment thereof."

According to Mr. Jha the first statement as regards the sum of Rs. 4,993-6-1 due to the Dhalbhum Raj by the above estate from 1st .January to 31st December, 1930, was not a clear and independent statement of the clues but was made subject to the condition that this was accepted as correct. Similarly he argued that the statement in the next paragraph of the letter as regards the sum of Rs. :n ,944-8-3 being the royalty up to the end of December, 1929, was also not a clear and independent statement of what is due but is made subject to the acceptance of the same. That in our opinion is not a proper reading of what is stated in the letter. In the very first sentence of the letter the Receiver is saying that a sum of Rs. 4,993-6-1 as shown

Sahebzada Mohammad Kamgar Shuh

Jagdish Chandra Deo Dhabal Deo

Das Gupta J.

Saheb;:ada Mohammad Kamgar Shah v.

Jagdish Chandra

Deo DhabalDeo

Das Gupta J.

in the enclosure to the docnment was according to him due to the Dhalbhum Raj for the year 1930 on account of royalty; to this he was adding a statement in the second sentence that as soon as this statement of dues was accepted as correct a cheque in payment thereof would be sent.

To say that however was not to say that the earlier statement of what is due is subject to the acceptance of the accounts.

The idea in the second sentence clearly was that in case the statement of what was due was not accepted as correct the matter will have to be decided by further discussion before payment will be made.

This second sentence cannot by any stretch of imagination be read as a condition to the statement made in the first sentence. Similarly the first sentence in the second paragraph of the letter as regards the sum of Rs. 31,944-8-3 being royalty up to the end of December, 1929, is, as we read the letter, made independent of what was stated in the following sentence and was not subject thereto.

The argument that these acknowledgments were conditional acknowledgments has therefore been rightly rejected by the High Court.

The second contention urged by the learned counsel is that in any case an acknowledgment by the Receiver of an estate is not an acknowledgment by an agent of the owners of the estate "duly authorised in this behalf" within the meaning of Explanation II of s. 19 of the Limitation Act, and so is not an acknowledg ment within the meaning of s. 19(1) of the Limitation Act.

According to the learned counsel "duly authorised in this behalf" in Explanation II of s. 19 means "duly authorised by the debtor" and does not include duly authorised by law or by an order of the Court.

For this proposition we can find no support either in authority or principle. Explanation II to s. 19 of the Limitation Act in saying "for the purposes of this section 'signed' means signed either personally or by an agent duly authorised in this behalf" has not limited in any way the manner in which the authority can be given.

The view taken in this matter by a Full Bench of the Bombay High Court in Annapagonda v.

Sangadiappa \) that "duly authorised" would include

(1) [1901] Born. S.R. 221 (F.B.).

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duly authorised either by the action of the party indebted or by force of law or order of the Court has been followed in other High Courts also (Viele : Reshbehary v. Anand Ram ('); Ramcharan Das v. Caya Prasad ('); Lakshumanan v. Sadayappa (') and Thankamma v. Kunhamma (') and in our opinion represents the correct state of law. Mr. .Jha has next argued that, in any case, law does not authorise the Receiver of an Estate to make acknowledgments of debt due from the estate.

For this proposition he has relied on a decision of the Bombay High

Court in Currimbhai v. Ahmedali (').

In that case it was held that an acknowledgment by an official assignee will not amount to an acknowledgment by an agent of the debtor.

Though this case does not deal strictly with the case of a Receiver, Mr. .Jha has relied on the reasoning therein as supporting his contention.

Our attention has been drawn by Mr. Sanyal, on behalf of the respondent to the fact that a contrary view has been taken in Lakshmanan Chetty v.

Sadayappa Chetty ('). Mr. Sanyal has argued that in respect of a debt due from the estate the Receiver of the estate fully represents the owners of the estate and that once it is held as it must be, that the Receiver had authority to pay the debt, Mr. Sanyal argues, it must necessarily be held that acknowledgment of a debt as incidental to the Receiver's duties in respect of the payment of the debts, is also within his authority. So, he argues that in every case an acknowledgment by a Receiver is an acknowledgment by a duly authorised agent of the debtor.

The above is a brief indication of the arguments on either side on Mr. .Jha's contention that the Receiver has no authority to acknowledge debts on behalf of the Estate. It is unnecessary for us however to decide for the purpose of the present appeal the question whether a Receiver is an agent of the owners of the estate of which he is the Receiver for the purposes of an acknowledgment of a debt under s. 19 of the Limitation Act.

(1) 43 Cal. 211.

(3) A.I.R. 1919 Mad. 816.

(5) 58 Born. 505.

(2) 30 All. 422.

(4) A.I.R. 1919 Mad 370.

(6) 35 M.L.J. 571.

Sahebzada Mohammad Kamgar Miah

Jagdish Chandra

Deo Dhabal Dto

Das Gupta J.

Sahetzi!da Mohammad Kamgar _Shah

Jagdish Chandra Deo Dhabal Deo

Das Gupta J.

April 21.

In the present case the suit .is based on the second lease of 1919 which was executed in favour of the then Receiver.

The acknowledgments by which limitation is claimed to have been saved is by a previous Receiver of the Estate through whom the appellant who is the present Receiver has derived his liability to pay the debt.

Section 19 is therefore in terms applicable as the acknowledgments have been signed personally by those previous Receivers, and no recourse is needed by the p!Jintiff to the second part of Explanation II.

This position was indeed fairly concluded by Mr. .Jha who agreed that in view of this it was not necessary for us to decide whether the Receiver of an Estate is by that fact itself an agent of the owners of the estate duly authorised to make acknowledgments under s. 19 of the Limitation Act.

There can be no' doubt that the acknowledgments on which the plaintiff relies are acknowledgments within the meaning of s. 19 of the Limitation Act and save limitation in respect of the period prior to August

12. l 935.

The Courts below were therefore right in rejecting the defendant's plea of limitation.

As both the contentions raised before us fail, the appeal is dismissed with costs.

Appeal dismissed.

THE COMMISSIONER OF INCOME-TAX,

BOMBAY CITY, HOMBAY

NANDLAL GANDALAL. (S. K. DAS, J. L. KAPUR and M. HIDAYATULLAH, .JJ.)

Income-fax-Assessment-Hindu undivided family carrying on business outside British India-Partnership entered into by coparceners with strangers in British India financed by remittances received from undivided family funds-Hindu undivided family, if resident m taxable territories-Indian Income-tax Act, 1922 (XI of 1922), ss. 4A(b).

N, a coparcener of the Hindu undivided family of G, carrying on business in Kathiwar, then outside British India, entered into a partnership with strangers in Bombay in 1944.

A total sum of Rs. 1,50,000 was remitted to N from the undivided family

SAHEBZADA MOHAMMAD KAM GAR SHAH

K. N. WANCHOO

K. C. DAS GUPTA, JJ.

Indian Limitation Act, 1908

s. 19

Deputy Commission of Singhbhum

Mohammad Bakhtyar Shah

s. 19

Limitation Act

CIVIL APPELLATE JURISDICTION

L. K. ]ha

B. K. Saran

S. T. Husain

S. K. ]ha

K. L. Mehta

H. N. Sanyal

C. Das Gupta

R. C. Prasad

DAs GUPTA. T .- Dhalbhum

Midnapur

Singhbhum

Raja Satrughan Deo Dhabal Deo

Jagdish Deo Dhabal Deo

Tollygunge

Raja Sa"trughan Deo Dhabal Deo

September 1, 1919

Saheb.zada Mohammad Kamgar ShDh

Jagdish Chandr11

Deo Dhabal

Jagdish Chandra

Das Gupta

August 12, 1941

August 12, 1935

August 12. 1935

cl. 16

cl. 16

s. 19

Limitation Act

High Court of Judicature at Patna

clause 16

.Sahebzada Mohammad Kamgar

Sahebzada Mohammad _ Kamgar Shah

Patna High Court

clause 16

s. 19

Limitation Act

Art. 133

clause 16

clause 16

Clause 6

Clause 16

Sahebzada Mohammad Kamgar Shah

Jagdish Chandra Deo D habal Deo

Sahebzada Mohammad Kamgar Shah

clause 16

Raja Satrughan Deo Dhabal Deo

Gopinath. Deo Dhabal Deo

Mohammad Bakhtyar Shah

Mohammad Anwar Shah

clause 16

.Jha

Jagdish Chandra

Deo Dhabal Dto

Jagdish Chanrka

Deo Dhabal Deo

clause 16

Jagdish Chadra Deo Dhabal Deo

clause 16

clause 16

cl. 16

cl. 16

clause 6

cl. 16

clause 16

Satrughna Deo Dhabal Deb

Clause 16

Sahebzaha Mohammed Kamgar Mah

Jagdish Chandr~

Sahebzada Mohammed Kamgar Shah

Jha

clause 16

cl. 16

cl. 16

Raja J agdish Dea Dhabal Dea

Dhalbhum Raj

1st .January to 31st December, 1930

Sahebzada Mohammad Kamgar Shuh

Jagdish Chandra

Deo DhabalDeo

s. 19

Limitation Act

s. 19(1)

Limitation Act

s. 19

s. 19

Limitation Act

Bombay High Court

Bombay High

Court

Sanyal

s. 19

Limitation Act

Sahebzada Mohammad Kamgar Miah

Sahetzi!da Mohammad Kamgar

Section 19

.Jha

s. 19

Limitation Act

s. 19

Limitation Act

NANDLAL GANDALAL

S. K. DAS

J. L. KAPUR

M. HIDAYATULLAH

Indian Income-tax Act, 1922

ss. 4A(b)

Bombay


Sahetzi!da Mohammad Kamgar _Shah

Jagdish Chandra Deo Dhabal Deo

Das Gupta J.

April 21.

SUPREME COURT REPORTS [1960]

In the present case the suit .is based on the second lease of 1919 which was executed in favour of the then Receiver.

The acknowledgments by which limitation is claimed to have been saved is by a previous Receiver of the Estate through whom the appellant who is the present Receiver has derived his liability to pay the debt.

Section 19 is therefore in terms applicable as the acknowledgments have been signed personally by those previous Receivers, and no recourse is needed by the p!Jintiff to the second part of Explanation II.

This position was indeed fairly concluded by Mr. .Jha who agreed that in view of this it was not necessary for us to decide whether the Receiver of an Estate is by that fact itself an agent of the owners of the estate duly authorised to make acknowledgments under s. 19 of the Limitation Act.

There can be no' doubt that the acknowledgments on which the plaintiff relies are acknowledgments within the meaning of s. 19 of the Limitation Act and save limitation in respect of the period prior to August

12. l 935.

The Courts below were therefore right in rejecting the defendant's plea of limitation.

As both the contentions raised before us fail, the appeal is dismissed with costs.

Appeal dismissed.

THE COMMISSIONER OF INCOME-TAX,

BOMBAY CITY, HOMBAY

NANDLAL GANDALAL. (S. K. DAS, J. L. KAPUR and M. HIDAYATULLAH, .JJ.)

Income-fax-Assessment-Hindu undivided family carrying on business outside British India-Partnership entered into by coparceners with strangers in British India financed by remittances received from undivided family funds-Hindu undivided family, if resident m taxable territories-Indian Income-tax Act, 1922 (XI of 1922), ss. 4A(b).

N, a coparcener of the Hindu undivided family of G, carrying on business in Kathiwar, then outside British India, entered into a partnership with strangers in Bombay in 1944.

A total sum of Rs. 1,50,000 was remitted to N from the undivided family

,.. .. ;.,

'.i>

) -

funds and utilised as capital in the partnership business.

N's brother joined the partnership in Bombay.

The partnership started another firm in Banaras and a third brother of N joined the firm.

For the year of assessment 1945-46 the Income-tax Officer held that the Hindu undivided family of G was resident in the taxable territories and included the said sum in the income of the family under s. 4(l)(b)(iii) of the Indian Income-tax Act, 1922, as having been brought into or received in British India in the relevant year and made the assessment on that basis.

On appeal by the assessee the Appellate Assistant Commissioner affirmed the assessment but the Income-tax Appellate Tribunal holding that in the year of assessment the family was not resident in the taxable territories deleted the said sum from the assessed income.

The decision of the Appellate Tribunal was upheld by the High Court in a reference under s. 66(1) of the Act made at the instance of the appellant: Held (per S. K. Das and J. L. Kapur, JJ.), that the expression 'control and management' occurring in s. 4A(b) of the Indian Income-tax Act means de facto control and management and the word "affairs" means the affairs of the Hindu undivided family capable of being controlled and managed by the said family as such.

It is .well-settled that a Hindu undivided family cannot exercise any controlling power of management of a partnership entered into by a coparcener with strangers either under the Indian Partnership Act, 1932, or under the Hindu law.

The partnerships in the instant case could not, therefore, constitute affairs of the Hindu undivided family within the meaning of s. 4A(b) of the Act, although the incomes from the said partnerships might belong to the said family, and could not determine its residence.

The place of accrual of income of a Hindu undivided family and the place of its residence need not necessarily be the same under the Indian Income-tax Act, 1922.

V. V. R. N. M. Subbayya Chettiar v. Commissioner of Incometax, Madras, [1950) S.C.R. 961, Kshetra Mohan Sannyasi Charan Sadhukhan v. Commissioner of Excess Profits Tax, West Bengal, [1953] 24 I.T.R. 488 and B. R. Naik v. Commissioner of Incometax, [1946] 14 I.T.R. 324, referred to.

Per Hidayatullah, J.-Under s. 4A(b) of the Indian Incometax Act, what are really affairs of the Hindu undivided family must be decided in the light of the Hindu law, and not the law of Partnership.

It is well settled that a coparcener of a Hindu undivided family cannot claim any item of property or share of his own and, consequently, where certain coparceners enter into partnerships with strangers by investing capital from out of the undivided family funds, as in the instant case, the income from the business must belong to the undivided family.

Where the Hindu undivided family enters into a business activity in the taxable territories through its coparceners, invests money and earns income, even though the partnership which results may not be an

17-6 SCI/ND/82

Commissioner of Income-tax Bombay City v.

N and lat Gandalal

Commissioner of lncame-tax, Bombay City v.

Nandlal Gandalal

S. K. Das :J.

"affair" of the family, there is still a business activity resulting in the partnership and the partnership is the evidence of that business activity.

This 3.ctivity of a permanent character is sufficient for purposes of income-tax law to constitute an "affair" of the family within the meaning of s. 4A(b) of the Indian Income-tax Act.

Approvier v. Rama Subba Aiyan, [1866] 11 M.I.A. 75, Katma Natchiar v. Rajah of Slzivaganga, [1864] 9 M.I.A. 539, Mangalchand Mohanlal, In re, [1952] 21 I.T.R. 164, Murugappa Chetty & Sons

v. Commissioner of Income-tax, [1952] 21 I.T.R. 311 and Kaniram Hazarimull v. Commissioner of Income-tax, [1955] 27 I.T.R. 294, referred to.

V. V. R. N. M. Subbayya Chettiar v. Commissioner of lncometax, Madras, [1950] S.C.R. 961, considered.

Control and management, in the case of a Hindu undivided family, can be exercised by one or more of its coparceners, even though partly, and if such coparceners reside in the taxable territories and manage its affairs, the family must be treated as resident in such territory.

CIVIL

APPELLATE

JURISDICTION: Civil Appeal No. 788 of 1957.

Appeal by special leave from the judgment and order dated February 16, 1%5, of the Bombay High Court in Income-tax Reference No. 38 /x of 19.54.

Daphtary, Solicitor-General of India, R. Ganapath;1 l;1er and D. Gupta, for the appellant.

R. ]. Kolah, S. N. Andley,

.J.

Dadachanji, Rameshwar Nath and P. L. Vohra, for the respondent.

1960.

April 21.

The .Judgment of S. K. Das and Kapur, JJ., was delivered by S. K. Das, J. Hidayatullah, J. delivered a separate Judgment.

S. K. DAs, J.-This is an appeal by special leave from the judgment and orders of the High Court of Bombay dated February 16, 19.'i.'i, in a reference un<ler section 66(1) of the Indian Income-tax Act, 1922, hereinafter called the Act. The reference was made in the following circumstances : The Hindu undivided family of one Gandalal carried on business in cloth in Wa<lhwan in Kathiawar, which at the relevant time was outside British India.

The family consisted of Gan<la1"1 and his four sons, (l) Girdharlal, (2) Hansrai. (3) Nandlal and (4) Ramniklal.

In J 944 Nandlal came to Bombay and started a cloth business in partnership with other persons, the partnership being known as Amulakh Amichand & Co.

Nandlal's share in the partnership was ten annas and that of his three partners, who belonged to the family of Amulakh Amicband, six annas. It was stated that the family of Amuiakh Amichand which was a well known business family of Bombay, did not supply any capital to the partnership and Nandlal alone was the financing partner.

On April 13, 1944, Nandlal received a sum of Rs. 50,000 from tbe Hindu undivided family of which he was a member, and a further sum of Rs. 50,000 on April 27, 1944.

Two other sums aggregating to Rs. 50,000 were also received from the Hindu undivided family on June 8, 1944, and June 29, 1944.

The case of the assessee was that a sum of Rs. 1,00,000 was given to each son by the father and the sums of money received on June 8, 1944, and June 29, 1944, were a loan by the Hindu undivided family to Nandlal.

Therefore, the case of the assessee was that Nandlal became the partner of the firm of Amulakh Amichand in his individual capacity.

The case of the Department, however, was that the total sum of Rs. 1,50,000 sent to Nandlal by the Hindu undivided family was utilised as capital in the cloth business of the partnership known as Amulakh Amichand & Co. Subsequently, Girdharlal, another brother of Nandlal, came to Bombay and joined the firm. Out

of the share of ten annas of Nandlal, Girdharlal was given a share of five annas.

The partnership firm of Amulakh Amichand & Co. then started a cloth business at Banaras, and the partners of the firm at Banaras were the partners of the Bombay firm of Amulakh Amichand & Co. and an outsider from Banaras.

A third brother of N_andlal also joined the Banaras firm, but he did not bring any capital.

For the assessment year 1945-46 the Income-tax Officer held that the Hindu undivided family of Gandalal was resident in the taxable territories (namely, British India), and hence he included the sum of Rs. l ,5{),000 in the income of the family under s. 4(1) (b )(iii) of the Act as having been brought into or received in British India in the relevant year and made an assessment on that basis.

The assessee appealed to the Appellate Assistant Commissioner, Bomba.y, but without success.

Then, there was an appeal to the

Commissioner of

Income tax, Bombay Ciry

Nandlal Gandalal

S. K. DasJ.

Commissioner of Income-tax, Bombay City

Jl(andlal Gandalal

S. K. Das].

Income-tax Appellate Tribunal, Bombay.

Two questions were raised before the Tribunal :

"(l) Whether Nandlal represented the Hindu undivided family of Gandalal of Wadhwan now in Saurashtra, in the firm Amulakh Amichand & Co., Bombay, and later on in the firms Amulakh Amichand & Co., Bombay and Banaras.

(2) Whether the Hindu undivided family of Gandalal was resident in the taxable territories m the relevant years of account." The Tribunal held on the first question that Nandlal and later Girdharlal joined the Bombay firm and also the Banaras firm of Amulakh Amichand & Co. as representing the Hindu undivided family of Gandalal and the money for starting the Bombay business came from the Hindu undivided family.

Accordingly, the Tribunal held that Nandlal was properly assessed in the status of a Hindu undivided family. On the second question the Tribunal held in favour of the assessee and came to the following conclusion:

"The business at Bombay and later on the business at Banaras cannot in our opinion, be considered to be the affairs of the Hindu undivided family of Gandalal.

These two businesses belonged to two separte entities, namely, the Bombay firm of Amulakh Amichand & Co. and the Banaras firm of Amulakh Amichand & Co. True, the Hindu undivided family would in due course of time receive a share of profit from these two firms, but all the same we do not think that it could be said that the firms of Bombay and Banaras constitute the affairs of the Hindu undivided family.

The businesses in Bombay and Banaras, according to the Partnership Act, belonged to Nandlal and others.

We are, therefore, of opinion that for assessment years

1945-4fi ... the Hindu undivided family was not resident in the taxable territories." The actual relief which the Tribunal gave to the assessee was expressed in the following words:

"For the assessment year l 945-45, the assessee's status would be Hindu undivided familv but non-resident.

In so far as the assessed incom~ is concerned the sum of Rs. 1,50,000 which was included under section 4(1 )(b)(iii) has to be deleted. The rest of the

- -

.- '

income accrued to the Hindu undivided family in the taxable territories."

At the instance of the Commissioner of Income-tax, Bombay, who is the appellant before us, the Tribunal stated a case and referred the following question of law to the High Court of Bombay for its decision under s. 66(1) of the Act.

The question was in these terms:

"Whether the Hindu undivided family of Gandalal represented by Nandlal in the firm of Amulakh Amichand & Co. of Bombay was resident in the taxable territories in the year of account relevant for the assessment year 1945-46." The answer to the question depended on the true scope and effect of s. 4A(b) of the Act.

The High Court held that the expression "the affairs of the Hindu undivided family" in s. 4A(b) did not have reference to the private or domestic affairs of the family, but referred to affairs concerned with income and taxation thereon. It said:

"vVe might put the matter in this way that when a coparcener carries on business in partnership on behalf of the Hindu undivided family, the affair is of the coparcener and not of the family, but when the business is carried on by the family itself then it is the affair of the family and not of the coparceners."

"The result is that we must agree, with the view taken by the Tribunal and we must answer the question submitted to us in the negative."

After the decision of the High Court the appellant obtained special leave and has come to us in pursuance of special leave granted by this Court.

We must make it clear in the verv outset that the first question raised before the Tribu'nal and decided by it against the assessee does not now fall for consideration. v\Thatever income Nandlal and Girdharlal received from the two businesses at Bombay and Banaras was income in their hands of the Hindu undivided family.

With that income we are not now concerned.

We are concerned with the second question, namely, whether the Hindu undivided family of Ganclalal was resident in the taxable territories in the

Commissioner of Income-tax, Bombay Cit)' v.

S. K. Das].

Commissiotler of

ltiiometax, Bombay Cir

v. .Natidlal Gandaial

S. K. Das].

relevant year so as to make the sum of Rs. 1,50,000 taxable under s. t(l)(b)(iii) of the Act on the basis of such residence. Clearly enough, if the Hin du undivided family of Gandalal was not resident in the taxable territories in the relevant year, the wm of Rs. J ,.50,000 would not be taxable under s. 4(1)(b)(iii) of the Act. \, Ye must, therefore, keep in mind the narrow scope of the question before us, which is whether the Hindu undivided family of GandaJal could be said to be resident in the taxable territories (i.e., British India) in the relevant year under the provisions of s. 4A(b) of the Act, even though the family carried on its own cloth business wholly outside the taxable territories.

It is necessary as well as convenient to read s. 4A(b) at this stage :

"4A. For the purposes of this Act-

(b) a Hindu undivided family, firm or other association of persons is resident in the taxable territories unless the control and management of its affairs is situated wholly without the taxable territories."

In V. V. R. N. M. Subbayya Chettiar v. Commisioner of Income-tax Madras (') this Court held that the test for deciding the residence of a Hindu undivided family laid down in s. 4A(b) of the Act was based very largely on the rule which had been applied in England to cases of corporations, and though normally a Hindu undivided family would be taken to be resident in British India, such presumption would not apply if the case could be brought under the second part of the provision.

It was also observed therein that the word "affairs" must mean affairs which are relevant for the purpose of the Income-tax Act and which have some relation to income: it was stated that in order to bring the case under the exception, the court has to ask whether the seat of the direction and. control of the affairs of the family is inside or outside British India, and the word "wholly" suggests that a Hindu undivided family may have more than one "residence" in the same way as a corporation may have.

The position in Hindu law with regard to a coparcener, even when he is the Karta, entering into partnership

(1) [1950] S.C.R. 961.

. -

-,..

with others in carrying on a business is equally well settled.

The partnership that is created is a contractual partnership and will be governed by the provisions of the Indian Partnership Act, 1932.

The partnership is not between the family and the other partners; it is a partnership between the coparcener individually and his other partners (see Kshetra Mohan Sannyasi Charan Sadhukhan v. Commissioner of Excess Profits Tax, West Bengal) ( 1).

The coparcener is undoubtedly accountable to the family for the income received, bnt the partnership is exclusively one between the contracting members, including the individual coparceners and the strangers to the family.

On the death of the coparcener the surviving members of the familv cannot claim to continue as partners with strangers nor can thev institute a suit for dissolution of p;;;.tnership; nor cn the stranger partners sue the surviving mern bers as partners for the coparcener's share of the loss.

Therefore, so far as the partnership is concerned, both under Partnership law and under Hindu law. the control and managemnt is in the hands of the individual coparcener who is the partner and not in the family.

\low, it is undisputed that but for the partnership business at Bombay or Banaras the Hindu undivided family of Gandabl was not resident in the taxable territories in the relevant year. The point for decision, therefore, is does the existence of the said partnership establish the residence of the family?

This r::iises two questions before us: firstly, whether the firm of Amulakh Amichand & Co. is one of the affairs of the Hindu undivided family of Gandalal because that is the only affair 'vhich has relation to the income sought to be taxed and on which the appellanl relies for determining the residence of the family; secondly, where the control and management of the said affair. looker! at from the point of view of the Hindu undivided family, is situate.

We think that in the context of the facts found in the case, these two qnestions are interlinked.

The expression "control and management" under s. 4A(b) signifies controlling- :rnd directive power, "the head and brain"

(l) [19'>3] 24 I.T.R. 488.

Commissioner of

Income-tax, Bombay City v.

Nand!al Gan.fa/al

S. K. Das].

Commissioner of

Income-tax, Bo.71bay City

Nand!al Gandalal

S. K. Das].

as it is sometimes called.

Furthermore, it is settled we think, that the expression control and management" means de facto control and management and not merely the right or power to control and manage (see B. R. Na1k v. Commissioner of Income-tax (')). It is also quite clear, we think, that if a coparcener becomes a partner (on behalf of the joint family) with strangers in a firm which carries on business in the taxable territories, that bv itself will not determine the residence of the family unless the control and management of the firm is at least, in part, in the Hindu undivided family.

On the facts of this case, the Hindu undivided family or for that matter, the Karta of that family, that is Gandalal, could exercise no power of controlling management over the partnership firm, either under Partnership law or under Hindu law.

It seems to us that the word "affairs" in s. 4A(b) must mean affairs of a Hindu undivided family which are capable of being controlled and managed by the said Hindu undivided family as silch. vVherc a coparcener enters into partnership with strangers. the Hindu undivided family exercises no controlling power of management over the partnership firm.

In that view of the matter the partnership firm cannot be an "affair" of the Hindu undivided family capable of being controlled and managed by the Hindu undivided family as such. It may be here observed that the decision in V. V. R. N. M. Subhayya Chettiar

v. Commissioner of Income-tax, Madras (') proceeded on the basis of onus only and as was specifically stated therein, it was confined to the year of assessment to which the case rebted and it was left open to the appellant of that case to show in future years by proper evidence that the seat of control and management. of the affairs of the family was wholly outside British India.

In the case before us the Tribunal no doubt found on the first. question raised before it that Nandlal and Girdharlal joined the Bombay and Banaras firms as coparceners of the Hindu undivided family and the money for starting the business came from the Hindu undivided family.

That finding by itself however does not determine the residence of the

(I) [1946] 4 I.T.R. 324.

(2) [19501 S.C.R, 961.

!'"" ( •

- .

\ 'J

Hindu undivided family of Gandalal.

Both under Hindu law and Partnership law the Hindu undivided family as such could exercise no control and management over the two businesses at Bombay and Banaras.

These businesses belonged to the partners and on the facts found in this case, it cannot be said that the businesses were the affairs of the Hindu undivided family of Gandalal within the meaning of s. 4A(b) of the Act.

We agree with the High Court that the position would be different if the Hindu undivided family itself carried on the business as its own business.

In that case the business would be an affair of the family, because the family wciuld be in control and management of the business.

At first sight it may

apper paradoxical that the income from the two businesses at Bombay and Banaras in the hands of Nandlal and Girdharlal should be treated as income of the Hindu undivided family and at the same time it should be held that the two businesses were not the affairs of the Hindu undivided family within the meaning of s. 4A(b) of the Act.

There is really no paradox because the place the accrual of income of such family and the place of its residence need not necessarily be the same under the Act.

Residence under s. 4A(b) of a Hindu undivided family is determined by the seat of control and management of its affairs, and in the matter of partnership business in British India the Hindu undivided family as such had no connexion whatsoever with its control and management. If the seat of control is divided, the family may have more than one place of residence; and unless it is wholly outside the taxable territories, the family will be taken to be resi dent in such territories for the purposes of the Act. But whereas in this case in respect of the partnership business, the family as such has nothing to do with its control and management, we fail to see how the existence of such a partnership will determfoe residence of the family within the meaning of s. 41\(b).

Therefore, we are of the opinion that the High Court correctly answered the question. The appeal fails and is dismissed with costs.

18-6 SCI/ND/82

Commissioner of Income tax, Bombay City

Nondlal Gandalal

S. K. DasJ.

CommissiMer of

Incometax, Bombay City v.

Nandlal Gandalal

Hidayatullah].

HrnAYATULLAH, J.-The Commissioner of Incometax, Bombay City, has filed this appeal, after obtaining special leave from this Court, against the judgment and order of the High Court of Bombay dated February l 6, 1955, in a Reference under s. 66( I) of the Indian Income-tax Act.

By the judgment under appeal, the High Court (in agreement with the decision of the Income-tax Appellate Tribunal, Bombay, given earlier) answered in the negative the following question : ' "Whether the Hindu undivided family of Gandalal represented by Nandlal in the firm of Amulakh Amichand & Co. of Bombay was resident in the taxable territories in the year of account relevant for the assessment year 1945-46." The facts briefly stated are as follows: ThPre was in Wadhwan State in Kathiawar a Hindu undivided family consisting of Gandalal and his four sons, Girdharlal, Hansraj, Nandlal and Ramniklal. This family was doing business in cloth.

Jn 1944 Nandlal went to Bombay and started on April 25, 1944, a cloth business in partnership with three strangers, known as Amulakh Amichand & Co.

Nandlal's share was ten annas, and that of his three partners, six ai, mas.

All the capital of the new firm was supplied by Nandlal, and for this purpose he received two remittances of Rs. 50,000 each on April 13 and 27 in the year 1944 and two other remittances aggregating to Rs. 50,000 on June 8 and 29 in the same year. Thus, a total sum of Rs. J ,!J0,000 was sent from Wadhwan to Bombay.

Subsequently, Girdharlal also went to Bombay and joined Amulakh Amichand & Co. and he was given five annas' share out of Nandlal's share of ten annas.

In 1946 Amulakh Amichand & Co. started another firm at Banaras under the same name.

The partners of the Banaras firm were the partners of the firm at Bombay, an outsider from Banaras and a third brother of Nandlal. He did not bring any capital, and presumably received a share along with his other two brothers.

For the assessment year 1945-46 the Income-tax Officer treated the Hindu imdivided family as resident in British India under s. 4A(b) of the Indian Incometax Act and assessed the family after adding the sum of Rs. 1,50,000 to the income from the firm of

. i ~

Amulakh Arriichand & Co., Bombay.

The appeal to the Appellate Assistant Commissioner failed.

On further appeal, the Appellate Tribunal, Bombay, held that Nandlal was still a coparcener and not a separated member, because the partition which was set up by him was not meant to be acted upon. The Tribunal, however, held that the decision of the Income-tax Officer and the Appellate Assistant Commissioner that the Hindu undivided family was resident in British India in the relevant account year was not sound. The Appellate Tribunal, therefore, ordered that the sum of Rs. 1,50,000 i.ncluded under s. 4(l)(b)(iii) of the Income-tax Act could not be included and must be deleted.

According to the Tribunal, the business at Bombay and later the business at Banaras could not be considered to be 'the affairs of the Hindu undivided family of Gandalal', so as to bring the matter within s. 4A(b) of the Act. The Appellate Tribunal held that these two businesses belonged to 'different entities', namely, the Bombay and Banaras firms, and that these firms could not be said to be "the affairs of the Hindu undivided family" but the affairs of Nandlal and his brothers under the law of Partnership. At the instance of the assessee, the Tribunal referred the above question for the opinion of the High Court.

The Bombay High Court referred to the decision of this Court in V. V. R. N. M. Subbayya Chettiar v. Commissioner of Income-tax, Madras (1), and pointed out that by the expression "the affairs of the Hindu undivided family" was meant not the private or domestic affairs of the family but some affairs which had some reference to the Income-tax Act. The word "affairs" must, it was held, be construed in relation to taxation. The learned Judges then referred to the position of a coparcener entering into partnership with strangers, and observed that when a coparcener carried on such business in pa, rtnership on behalf of the Hindu family, "the affair" was of the coparcener and not of the family, but when the business was carried on by the family itself, then it was "the affair" of. the family and not of the coparcener or coparceners. They pointed out that in the cited case Faz! Ali, .J., seemed to have

(!) [1950] S.C.R. 961.

Commissioner of Income-tax, Bombay City

Nandlal Gandalal

Hidayatullah ].

Commissioner of

Incometax, Bombay City v.

Nandlal Gandalal

Hidayatullah J.

held that even though a partnership business might be an 'activity' of the Hindu family, it would not be "the affair" of the Hindu family in the sense in which the expression was used in the Indian Income-tax Act.

They, however, held that it did not follow that every activity of a coparcener or of a Karta, even if the activity resulted in profit, became "the affair" of the Hindu undivided family.

Thus, treating the business of Amulakh Amichand & Co. as "the affair" of the coparceners concerned and not of the Hindu undivided family, the High Court in agreement with the opinion of the Appellate Tribunal, answered the question in the negative.

Before dealing with the arguments addressed in the case and the interpretation of the relevant provision, it will be useful to summarise the findings. It is found that the Hindu undivided family did not disrupt and partition the assets. N andlal and Girdharlal continued to be coparceners, and the sum of Rs. 1,50,000 represented the funds of the Hindu undivided family.

There is no finding that besides the entering into partnership by some of the coparceners with outsiders, there was, in the taxable territories, any other business.

There is also no finding by the Tribunal that no part of the control and management was exercised in British India, though the High Court did find this to be so.

We are concerned in this case with the application of s. 4A(b), which deals with 'residence' in the taxable territories, of Hindu undivided family, firm or other association of persons. Before the present amendment, the section read as follows:

"4A. For the purposes of this Act-

(b) a Hindu undivided family, firm or other association of persons is resident in British India unless the control and management of its affairs is situated wholly without British India." The words "British India" have now been replaced by the words "taxable territories"; but the reasoning applicable to tl}em is the same. The section was plain in so far as its intent and purpose was concerned.

It made a Hindu undivided family resident in British India, unless the control and management of its affairs

....

was situated wholly without British India. If the control and management was wholly or partly situated in British India, then the family was treated as a resident.

The words "wholly without British India" showed that even if a part of the control and management, be it ever so small a part, was exercised in British India, the provision was satisfied.

So far, there is no dispute, and it is further clear that the "affairs" of the Hindu undivided family refer to something connected with the law of Income-tax. The section does not refer to the domestic or private affairs of the Hindu undivided family. It refers to an activity resulting in the making of income.

Parties are agreed -and I think rightly-that this aspect of the law is clear and unambiguous.

It is also settled after the decision of this Court in Subbayya C hettiar' s case (').

Parties are, however, at variance, when one comes to the interpretation .of the words "its affairs" in the section, anu tries to find the situs of the control and ' management. In cases where the Hindu undivided family itself or through its Karta controls and manages business in the taxable territories, no difficulty arises; but where, as here, the Hindu undivided family is represented by one of its coparceners as a partner in a firm, one faces some difficulties.

Two questions then arise, which are:

(a) Is there any "affair" of the Hindu undivided family in the taxable territories m such nrcumstances; and

(b) Is the fact that the coparcener controls and manages the partnership, wholly or partly, sufficient to enable one to say that the control and management of the family is located in the taxable territories?

Now, it is settled law that a Hindu undivided family , cannot be a partner under the law of partnership.

Such of the coparceners who join the partnership are regarded quoad the other partners, as individuals in their own names and rights.

Yet, the benefits that arise to them from the partnership belong to the family, and their rights are the asset of the family.

We have recently held in Charandas Harida.S v. Commissioner Df Income-tax, Bombay

(2) that in such a situation the matter has to be looked at in the light of

(1) [1950] S.C.R. 961.

(2) [1960] 3 s.c.R. ,296.

1%0

Commissioner of

Income-tax, Bombay Ciry

Nandlal Gandalal

Hida.YJlullah J.

Commissioner of Income-tax, Bomba)' Cit;'

Nandlal Gcndalal

Hidayatullah J.

three separate and independent branches of law. They are the law of Partnership, the Hindu law and the law relating to Income-tax.

The implications of a coparcener joining as partner with strangers are different when one views the matter from the angle of the law of Partnership or from the angle of the Hindu law or the law of Income-tax.

In so tar as the law of Partnership is concerned, the coparcenary has no place in the partnership, and the coparcener-partner is everything.

But, viewed from the angle of Hindu law, the position is entirely different. ln this connection, we have to bear in mind two principles of the law relating to a coparccnary, which are well-settled. The first is contained in a well-known passage in the judgment of Lord Westbury in Appovier v. Rama Subba Aiyan('), which reads:

"According to the true notion of an undivided family in Hindu law, no individual member of that family, whilst it remains undivided, can predicate of the joint and undivided property, that he, that particular member, has a certain definiLe share......

The proceeds of undivided property must be brought, according to the theory of an undivided family, to the common chest or purse, and then dealt with according to the modes of enjoyment by the members of an undivided family."

The second is equally well-known, and is found stated in the judgment of Turner, L. J. in Katama Natchiar v. Rajah of Shivaganga (') in the following words:

"There is community of interest and unity of -< possession between all the members of the family, and upon the death of any one of them the others may well take by survivorship that in which they had during the deceased's life-time a common interest and a common possess10n.

No doubt, there are other principles also which qualify those quoted, as, for example, the right of a coparcener to claim a partition, or, where such usage obtains, to alienate his interest, which give rise to the .>- expression that the coparcener has a share. In point of Hindu law, however, a coparcener cannot claim ~

(l) [1866] 11 M.I.A. 75, 89.

(2) [1864] 9 M.I.A. 539, 61 l.

any item of property or even a share of it as his own, and his dealings with the assets are, in so far as he is concerned, for the benefit of the family.

The law of Income-tax makes the sole test for purpose of residence of a Hindu undivided family, the existence of an 'affairs' and its control and management even partly in the taxable territories.

For this purpose, one may look at the actual facts, and an inference from facts in the light of Hindu law is equally open.

It is thus plain that whilst in the eye of the law of Partnership the coparcener who is a co-partner is everything, in the eye of Hindu law he is no more than a member of a bo, dy of owners.

In attempting to find out if there is any 'affair' of the Hindu undivided family,. we can consider the matter from the point of view of Hindu law. If this is the true position of a coparcener in Hindu law, it is difficult to accept the view of the High Court and of the Tribunal that there was no 'a'ffair' of the family in British India. The High Court, with respect, posed the wrong question when it asked itself, "was Amulakh Amichand & Co., an affair of the family?". That question is self-evident, and the answer is 'no'. from the point of view of the law of Partnership. The proper question to ask was. as I have framed it, viz., ·"was there an affair of the Hindu undivided family in British India?". To search and find this 'affair', it is not necessary to look for it within the partnership any more than to look for it in the affairs of a bank where the family keeps its money with which it does business. That this was not a mere 'activity' but an activity involving expenditure of familv funds in British India and resulting in the earning of money is admitted on all hands.

The income received from the partnership belonged to the family, as is well-settled. See Mangaichand Mohanlal, In re ( 1), Murugappa Chetty &Sons v. Commissioner of Income-tax (') and Kaniram Hazarimull v.

Commissioner of Income-tax (3) and the numerous cases cited there.

The affair. if any, which we have to find, is not to be found within the four corners of the partnership

(I) [19.52] 21I.T.R.164.

(2) [1952] 21I.T.R.311.

(3) [1955] 27 I.T.R. 294.

Commissioner of

Income-tax, Bombay City v.

N cndlal Gandalal

.HitlayalullohJ.

Commissioner of

Income tax, Bombay Citp

Nandlal Gandalal

HidayatuJlah J.

but outsi<le it.

The partnership was only the result of the business activity of the family and evidence of it.

The affair we have to find must be regulated by Hindu bw and not by the law of Partnership, because a partnership is regulated by the two laws considered the other way round. ·

The section we have to interpret speaks of the affairs of the Hindu undivided family whatever shape it may take. and the enquiry is thus limited to what is the dictate of Hindu law.

It is an error to think that one can ignore a palpable conclusion of that law. and go to find the answer from the law of Partnership.

Nor .do I think that the decision of this Court in Subbayya C hettiar' s case (') laid down any contrary proposition. There, the karta who visited India for a short period dealt with some matters including the starting of certain businesses. The Hindu undivided family was all the time in Ceylon, and it was held that his actions could be described as 'activities'. Indeed, the matter was not decided as to whether the 'affair'. if there was one, was of the family or of the coparceners, and the case went against the assessee on the burden of proof which he had failed to discharge, to bring his case within the

e1'ception. If the karta had lived in India, or some other coparcener or coparceners had stayed on permanently to manage the 'affairs', then the question would have been considered, perhaps, differently.

In this case, we are not concerned with the 'affairs', of the firm of Amulakh Amichand & Co., but with the 'affairs' of the Hindu undivided family.

The coparceners who became partners could not say that they were not concerned with the Hindu undivided family to which they belonged and an undivided asset of which thev owned in common with others.

Their investing moneys, becoming partners and running the partnership, starting other partnerships were, from the view point of the coparcenary 'lccording to Hindu law, as much the affair of the rest of the family as their own.

In view of what I have said, the first of the two questions posed earlier must be answered in the affirmative, that is to

(1) [1950] S.C.R. 961.

> -

,... { .

say, that there was an 'affair' of the Hindu undivided family in the taxable territories (then British India) in the circumstances of this case.

The question then is : where was the control and management of the Hindu undivided family located?

If it was wholly located without the taxable territories (then British India), then the family would be nonresident.

The burden was on the assessee to establish this, and we were not shown any evidence in this behalf.

The question can be decided here also on the burden of proof alone, as was done in Subbaya Chettiar's case ('). It need not, however, be decided on that narrow issue for reasons, which will presently appear.

Section 4A deals with residence of an individual at one end and of a corporation like the company at the other.

It also deals with the residence of three entities, viz., Hindu undivided family, firm and association of persons in the remaining part. The tests for these three categories are different.

Special tests have been provided for individuals, based on residence for a certain number of davs.

Two alternative tests have been provided for ompanies. the first being that the control and management of their affairs must be situated wholly within the taxable territories.

Where the control is without. a comnanv can still be taxed if its income within the taxabl~ territories in the year of account (omitting, capital gains) is greater than its income without the taxable territories. with the , same om1ss10n.

The first provision is necessary, because a company can have more than one residence, its residence being where it 'keeps house and does business'.

The test is reverse\! for a Hindu undivided family, which is non-residence only if the whole of its control and management is situate without the taxable territories.

The residence of the members of the coparcenary is not a relevant factor, but if control and management is exercised by them within the1 taxable territory, the family as a whole is treated as resident. In Subbayya Chettiar's case (1); this Court observed that 'situated' implies functioning somewhat permanently, though the management and control may be exercised

(1) [1950] S.C.R. 261. 83

19-6 SCI/ND/82

1960 .

Commissioner of

Income-ta", Bombay City v.

Nandlal Gandalal

HidayalU/lah :J.

Commissioner of

lncometax, Bombay City

Nandlal Gandalal

HidayatullahJ.

in more than one place.

To prove that management and control is within the taxable territories, something more than a casual 'activity' is needed.

The same tests also apply to a firm and an association of persons.

The words 'control and management' have been figuratively described as 'the heacl and brain'.

In the case of an individual, the test is not necessary, because his residence for a certain period is enough, it being clear that within the taxable territories he would necessarily bring his 'head and brain' with him.

The 'head and brain' of a company is the Board of Directors, and if the Board of Directors exercises complete local control, then the company is also deemed to be resident.

In the case of fil"ms, association of persons and Hindu undivided family, the control and management can be exercised by one or more of the group.

So long as this control ancl management (even partly) is found, and it must be so when some coparceners reside in British India and manage the affair, the family must be treated as resident.

The necessity for the test is thus obvious.

The J ncome-tax law anticipated that control and management of the affairs of Hindu undivided families (firms and association of persons), might easily be in two or more places, one or more coparceners being within the taxable territories and the other or others, without.

To prevent the escape of tax and to get at the income of such families having multiple places of control and management, it was provided that the whole of the control and management must be without the taxable territories to avoid the implication of residence.

Otherwise, rlifferent coparceners can manage different businesses in the taxable territories and the family cannot be regarded as resident if the karta lived outside, an anomaly which does not really arise.

In the present case, can one say that. the control and management was wholly without the taxable territories (then, British India)? If one goes by the case set up by the assessee, one. finds that the claim was that there was a partition in the family and that Nandalal came to

r I

Bombay as a separated member. This claim involves the admission that the affairs, such as they were, were not controlled from Wadhwan. Since, however, the case of partition pleaded by the assessee was not accepted, it might be held that the family at Wadhwan was, perhaps, also in control.

But it is equally clear that a part of the control . of the affairs of the family was done in British India by those coparceners, .who became partners in the business and through whom and not directly from Wadhwan the partnership business at Bombay was run to the benefit of the family.

Those partn.ers who were also coparceners of the family arranged to start this business at Bombay and stayed on and managed it; they started a fresh business at Banaras, admitted a stranger as partner at the new place and presumably supplied , capital from the Bombay firm or from the family coffers. There is no claim at all that they supplied their own separate funds.

All these actions were acts of control and management.

They were not casual but permanent in character.

Thus, the control and management of family affairs vis a vis the partnership vv'as being done by them. The coparceners who Januslike face two ways, cannot shelter behind the law of Partnership, and claim that their action had no reference to the 'affairs' of the family, which was at their back.

I am not eq1,1ating the affairs of the partnership with the affairs of the family.

But the entire business involved a family undertaking, and those affairs were being managed in British India. This control and management of the businesses was, in fact, and for purposes of the law of Income-tax, control and management of the 'affairs' of the Hindu undivided family within British India, . a_nd the family must, therefore, be regarded as resident in the accounting year within British India. In my judgment, the decision of the Bombay High Court, with respect was erroneous. The answer to the question ought to have been in the affirmative.

I would, therefore. dissolve the answer given by the Bombay High Court, and instead, would answer the question in the affirmative.

I would also order that

Commissioner of

Income-tax, Bombay City

Nand(al Gandalal

Hidayatullah J.

Commissioner of

Income-tax, Bombay City v.

Ncmdlal Gandalal

HidayatullahJ.

the respondent bear his own costs and pay those of the appellant here and throughout.

ORDER OF COURT.

In accordance with the majority judgment of the Court, the appeal is dismissed with costs.

Appeal dismissed.

STATE OF BOMBAY

SUPREME GENERAL FILMS EXCHANGE LTD. (with connected appeal)

(S. K. DAs, A. K. SARKAR and M. HrnAYATULLAH, JJ.)

Court Fee-Amendment of statute enabling levy of higher court fee-When retrospective-Suit instituted before amendment, appeal filed thereafter-Court fee on memorandum of appeal-Court Fees Act, 1870 (7 of 1870), ss. 4, 6, Sch. I, Art. 1-Court Fees (Bombay Amendment) Act, 1954 (Rom. 12 of 1954).

In 1954 certain amendments were made in the Court Fees Act, 1870, as applied to Bombay by the Court Fees (Bombay Amendment) Act, 1954, by which the system of charging court fees in the Bombay High Court on the Original Side was altered and instead of a fixed fee payable on the plaint, etc., ad valorem fees became leviable. The amendments came into force on April 1, 1954, but there was no provision, express or by necessary intendment, for giving them retrospective effect.

In respect of appeals filed after that date against decrees passed in suits instituted before that date, the question arose as to whether the court fees payable on the memoranda of appeal were according to the law in force at the date of the filing of the suits or according to the law in force at the date of the filing of appeals: Held, that the court fees payable on the memoranda of appeal were according to the law as it stood at the date of the filing of the suits.

An impairment of the right of appeal by putting a new restriction thereon or imposing a more onerous condition is not a matter of procedure only; it impairs or imperils a substantive right and an enactment which does so is not retrospective unless it says" so expressly or by necessary intendment.

Hoosein Kasam Dada (India) Ltd. v. The State of Madhya Pradesh and others, [1953] S.C.R. 987 and Garikapatti Veerayya v.

N. Subbiah Choudhury, [1957] S.C.R. 488, followed.

A Reference under Section 5 of the Court Fees Act, (1954) 57 Born. L.R. 180, Amara Eswaramma and others v.

Makkam

....

r f .

Das

Section 19

.Jha

s. 19

Limitation Act

s. 19

Limitation Act

THE COMMISSIONER OF INCOME-TAX, BOMBAY CITY, BOMBAY

NANDLAL GANDALAL

L. KAPUR

M. HIDAYATULLAH

Indian Income-tax Act, 1922

ss. 4A(b)

Kathiwar

Bombay

Banaras

s. 4(l)(b)(iii)

Indian Income-tax Act, 1922

s. 66(1)

S. K. Das

J. L. Kapur

s. 4A(b)

Income-tax Act

Indian Partnership Act, 1932

s. 4A(b)

Income-tax Act

Hidayatullah

s. 4A(b)

s. 4A(b)

Income-tax Act

Mangalchand Mohanlal

Daphtary

D. Gupta

R. ]. Kolah

S. N. Andley

Dadachanji

Rameshwar Nath

P. L. Vohra

Kapur

The .Judgment of S. K. Das and Kapur, JJ.,

S. K. DAs

High Court of Bombay

section 66(1)

Indian Income-tax Act, 1922

Gandalal

lhwan

Kathiawar

Gan

Girdharlal

Hansrai

Nandlal

Ramniklal

Amulakh Amichand & Co.

Amulakh Amicband

Amuiakh Amichand

April 13, 1944

April 27, 1944

June 8, 1944

June 29, 1944

Amulakh

Banaras firm

British India

s. 4(1)

S. K. DasJ.

Nandlal

section 4(1 )(b)(iii)

s. 66(1)

Amulakh Amichand & Co. of Bombay

s. 4A(b)

s. 4A(b)

Ganclalal

.Natidlal Gandaial

S. K. Das

s. 4(1)(b)(iii)

s. 4A(b)

s. 4A(b)

s. 4A(b)

England

Income-tax Act

Indian Partnership Act, 1932

Gandabl

s. 4A(b)

s. 4A(b)

s. 4A(b)

s. 4A(b)

s. 4A(b)

s. 41

Nandlal Gandalal

HrnAYATULLAH

s. 66( I)

Income-tax Act

Income-tax Appellate Tribunal, Bombay

Wadhwan State

Hansraj

April 25, 1944

June 8 and 29

50,000 on June 8 and 29 in the same year.

Wadhwan

s. 4A(b)

Appellate Tribunal, Bombay

s. 4(l)(b)(iii)

Income-tax Act

s. 4A(b)

Bombay High Court

Income-tax Act

Faz! Ali

Income-tax Act

N andlal

s. 4A(b)

Subbayya C hettiar

Hida.YJlullah

Westbury

Turner

Mangaichand Mohanlal

.HitlayalullohJ.

HidayatuJlah

Ceylon

Subbaya Chettiar

Section 4A

Subbayya Chettiar

Commissioner of

Income-ta", Bombay City

Nandalal

Wadhwan

Ncmdlal Gandalal

STATE OF BOMBAY

A. K. SARKAR

M. HrnAYATULLAH

ss. 4, 6

Art. 1

Court Fees Act, 1870

April 1, 1954

Section 5

Court Fees Act