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PETITIONER: COMMISSIONER OF EXPENDITURE-TAX, GUJARAT,AHMEDABAD

       Vs.

RESPONDENT: DARSHAN SURENDRA PAREKH

DATE OF JUDGMENT: 12/12/1967

BENCH: SHAH, J.C. BENCH: SHAH, J.C. RAMASWAMI, V. BHARGAVA, VISHISHTHA

CITATION:  1968 AIR 1125            1968 SCR  (2) 589  CITATOR INFO :  RF         1991 SC1289  (16)

ACT: Expenditure Tax Act (29 of 1957), ss. 2(g) and 4-Assessee  a Hindu  undivided  family-Karta, if  dependant  of  assessee- Expenditure  by  trustees on behalf of  children  of  karta- Whether liable to be included under s.  4(i) or (ii).

HEADNOTE: Section  4(i) of the Expenditure Tax Act, 1957, is  intended to  include in the taxable expenditure of an  assessee,  the expenditure  incurred  directly or indirectly  by  a  person other  than the assessee for discharging any  obligation  of the  assessee,  or  for  the  personal  requirement  of  the assessee or of any of the assessee’s dependents, which,  but for the expenditure havingbeen  incurred by  that  other person would have been incurred by thesee;  and, s.  4(ii) is intended to include any expenditure incurred byany dependent of the assessee for the benefit of the assessee or of  any of his dependents out of any settlement on trust  or other source made or created by the assessee. A  Hindu, his children by his first wife, his  second  wife, and  children by her, formed a Hindu undivided family,  with himself as the karta.  By deeds of trust he settled  certain assets  belonging  to  the joint family  in  favour  of  the children by the first wife and appointed trustees to  manage the assets, to collect the income and to defray the expenses of  the children.  The karta was also possessed of  separate property.   In  computing  the taxable  expenditure  of  the assessee-family for the years 1958-59 and 1959-60, under the Expenditure Tax Act, the department included two items : (1) the  expenditure  incurred  by the karta,  out  of  his  own separate  property  for his own purposes; and  (2)  the  sum spent  out  of  the trust estate for  the  children.   On  a reference,  the High Court held that the two items were  not chargeable to tax. In appeal to this Court it was contended that the first item was liable to be included in the expenditure of the assessee family under s 4(i) because, the karta in a Hindu  undivided family is a ’dependent’ and the expenditure incurred was  by a   person  other  than  the  assessee  for   the   personal

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requirement of a ’dependent’ and the family would have  been liable  to meet the expenditure if it were not  incurred  by the Karta, and the second, either under s. 4(i) or (ii). HELD : (1) The expression ’other member of the family’ in s. 2(g) (H) (b) does not include a coparcener : it means  wives and  unmarried  daughters of coparceners and widows  of  the family.  A karta, is expressly excluded from cl. (a) and  is not  within the expression ’other member of the  family’  in cl.  (b).  Therefore, the karta is not a  ’dependent’.   The facts   that  when  a  karta  incurs  expenditure  for   the coparceners or other members out of his separate estate  the expenditure  is  liable  to  be  included  in  the   taxable expenditure of the family, and that the expenditure incurred by  a  coparcener  or  other member of  family  out  of  his separate  property  in  respect of the  obligations  of  the family, or for the personal requirements of the  coparceners or other members of the family, is also liable to 590 ,be  included in the taxable expenditure of the family,  are not grounds for attributing to the expression ’dependent’  a wholly  artificial  meaning  different  from  its  statutory definition.  There is nothing in the scheme of the Act which suggests  that the expression ’dependent’ in s. 4(1) of  the Act  was  used  in  a  sense  different  from  that  of  the definition.   No  rule of interpretation  permits,  for  the purpose  of  s.  4(i) of the Act,  the  application  of  the statutory definition of ’dependent’ to bring within the  net of taxation, expenditure incurred for coparceners other than the  karta,  and of .a special meaning of  that  expression, inconsistent alike with the personal law of the parties, and the  statutory  definition,  to  bring  within  the  net  of taxation,  the expenditure for the karta.  The Court  cannot attribute  two different meanings to a single expression  in its application to two different situations contemplated  by a single clause. [593 H; 594 C-D, F; 595 C-E; 596 B-C] For the year 19591-60, s.4(i) was amended by the deletion of the  words  ’which  but  for  the  expenditure  having  been incurred  by that other person, would have been incurred  by the  asses-see’.   But these words were a  surplusage  :  by deleting  them  no intention to alter the  ’meaning  of  the original clause (i) could be, attributed to the  Legislature [598 E-F] Therefore,  for both the years, the expenditure incurred  by the karta out of his separate property for his own  purposes could  not  be taken into account in computing  the  taxable expenditure of the assessee-family, even if the family would have been liable to incur that expenditure [596 F] (2)The  Appellate  Tribunal  found  that  as  regards  the children  of  the karta, the trustees ’had  paid,  spent  or applied the income.  If the finding meant that the  trustees incurred  the  expenditure  for necessary  expenses  of  the children,  the  case  would  fall under  s.  4(i)  for,  the expenditure would be deemed to be incurred by a person other than the assesseefamily for discharging an obligation of the family.   If it meant that the ,expenditure was incurred  by or on behalf of the children after it was received from  the trustees,  the case would fall under cl. (ii).   ’no  trusts were  created  by  the karta out of the  family  funds;  the children were dependants within the meaning of s. 2(g);  and the  expenditure  was  incurred  for  the  benefit  of   the dependents  of the family.  The High Court was in  error  in observing  that the expenditure contemplated by s. 4(ii)  is one which enures for the benefit of a person other than  the person  who  incurs  the expenditure.   If  expenditure  was incurred by a dependent for his own benefit out of any gift,

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donation  or settlement on trust or out of any other  source made  or  created by the undivided family,  the  case  falls within the terms of s. 4(ii). [597 B-F] For  the year 19,59-60, the Legislature amended s.4(ii)  and expressly  provided  that  where the  assessee  is  a  Hindu undivided family, any expenditure, incurred by any dependent of  the  assessee  from or out of  any  income  or  property transferred  directly or indirectly to the dependent by  the assessee,   is  liable  to  be  included  in   the   taxable expenditure of the assessee.  Thus the dependent who  incurs the expenditure need not be other than the dependent to whom the  property  is  transferred by  the  assessee,  and,  the expenditure  incurred for his own purposes by the  defendant to  whom the property is transferred by the  assessee-family falls  within s.4(ii) as amended.  Therefore, if the  amount expended from out of the trust estate be held to be expended by  the  trustees, the case -falls within the terms  of  cl. (i):  if it be held that the expenditure was incurred by  or on behalf of the children after the income was received from the trustees it would fall within the amended cl. (ii). [598 F-H; 599 A-B] 591

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2523 and 2524 of 1966. Appeals  from the judgment and order dated October 26,  1964 of the Gujarat High Court in Expenditure Tax Reference No. 1 of 1963. B.Sen, R. N. Sachthey and S. P. Nayar, for the appellant (in both the appeals). S.T. Desai and I. N. Shroff, for the respondent (in both the appeals). The Judgment of the Court was delivered by Shah,  J. One Surendra had by his wife Rameshchandrika  (who died  in 1947) three children-Darshan, Ranna  and  Rajeshri. By his second wife Pratima he had two sons and one daughter. Surendra,  his wife Pratima and his children formed a  Hindu undivided  family.  Surendra executed three  deeds  settling certain  assets belonging to the Hindu undivided  family  in favour  of  his children Darshan, Ranna  and  Rajeshri,  and appointed  trustees to manage the assets and to collect  the income  arising  therefrom.  The three children  also  owned some  property which they had inherited from  their  mother. Separate books of account were maintained in respect of  the two  sets  of properties and of income  received  therefrom. Surendra   was   also  possessed   of   separate   property. Expenditure for the education of the three children was,  it appears, defrayed out of the income received from the  trust estates. In a proceeding for assessment of tax under the Expenditure- tax  Act,  1957,  of  the Hindu  undivided  family  for  the assessment year 1958-59 the Expenditure Tax Officer  brought to  tax  Rs. 20,508/- being the aggregate of  the  following heads  of  expenditure  less  the  basic  allowance  of  Rs. 30,000/- : Rs. 11,504/-Expenditure of the Hindu undivided family; Rs. 10,321/-   Expenditure for the minors out of the                      separate properties; Rs. 28,683/-   Expenditure incurred by Surendra              out of his separate property. The order of the Tax Officer was confirmed by the  Appellate Assistant Commissioner and the Appellate Tribunal.

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The Tribunal referred to the High Court of Gujarat under  s. 25(1)  of  the Act, three questions, out of which  only  two survive for consideration:                "1.  Whether  on the facts of the  case,,  in               computing  the  taxable  expenditure  of   the               assessee H.P.F. the sum                592                of   Rs.  28,683/-  being   the   expenditure               incurred  by Shri Surendra, the Karta  of  the               H.U.F.  out  of  his  own  self  acquired  and               separate property was includible in law ?                2.   Whether  on  the facts of  the  case  in               computing  the  taxable  expenditure  of   the               assessee H.U.F. the sum of Rs. 10,321/-  being               the   amount   spent  by  the   trustees   was               includible in law?" The  High Court answered the two questions in favour of  the assessee.  Appeal No. 2523 of 1966 arises out of that order. The  relevant provisions of the Act may be briefly  noticed. Clause  (c)  of S. 2 defines an "assessee"  as  meaning  "an individual or a Hindu undivided family by whom  expenditure- tax or any other sum of money is payable under this Act, and includes every individual or Hindu undivided family  against whom  any proceeding under this Act has been taken  for  the assessment  of  his  expenditure".   Section  2(g)   defines "dependent"  as  meaning  "(i)  where  the  assessee  is  an individual,  his  or, her spouse or child wholly  or  mainly dependent on the assessee for support and maintenance;  (ii) where  the assessee is a Hindu undivided family  -(a)  every coparcerner  other than the karta; and (b) any other  member of  the  family who under any law or order or  decree  of  a court,  is  entitled to maintenance from  the  joint  family property".   Section 2(h) defines "expenditure"  as  meaning "any  sum in money or money’s worth, spent or  disbursed  or for the spending or disbursing of which a liability has been incurred by an assessee, and includes any amount which under the provisions of this Act is required to be included in the taxable expenditure".  Section 3 which imposes the charge of expenditure-tax provides                "Subject to the other provisions contained in               this  Act,  there shall be charged  for  every               financial  year  commencing on  and  from  the               first  day of April, 1958, a tax  (hereinafter               referred to as expenditure-tax) at the rate or               rates specified in the Schedule in respect  of               the expenditure incurred by any individual  or               Hindu undivided family in the previous year:                Provided Section  4  deals  with the amount to  be  included  in  the taxable expenditure.  The section as applicable to the  year of assessment 1958-59 read as follows                "Unless otherwise provided in section 5,  the               following   amounts  shall  be   included   in               computing  the  expenditure  of  an   assessee               liable to tax under this Act, namely 593               (i)   any   expenditure   incurred,    whether               directly  or  indirectly by any  person  other               than the assessee in respect of any obligation               or personal requirement of the assessee or any               of   his   dependents  which,  but   for   the               expenditure having been incurred by that other               person,  would  have  been  incurred  by   the               assessee, to the extent to which the amount of               all such expenditure in the aggregate  exceeds

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             Rs. 5,000/- in any year;               (ii)  any   expenditure   incurred   by    any               dependants of the assessee for the benefit  of               the  assessee or of any of his dependants  out               of  any gift, donation or settlement on  trust               or out of any other source made or created  by               the assessee, whether directly or indirectly. Explanation.- Section  5  sets out certain exemptions and s.  6  sets  out certain   deductions   in   the   computation   of   taxable expenditure.   In  computing the taxable expenditure  of  an assessee under the Act, the expenditure actually incurred by an  assessee  is  increased by  certain  specific  items  of expenditure incurred by persons other than the assessee, and reduced  by the amounts exempted under s. 5 or permitted  to be deducted under s. 6 of the Act. The  dispute in the appeal relates to the inclusion  of  the expenditure incurred by Surendra out of his separate estate, and the expenditure incurred out of the estate  beneficially vested  in his children under the deeds of trust.   The  Tax Officer  brought to tax the first item under s. 4  (i)  read with cl. (ii) (b) of s. 2 (g), and the second item under  s. 4(ii) of the Act.  The Appellate Assistant Commissioner  and the  Tribunal  were  of the view that both  the  items  were chargeable to tax under s. 4 (i) of the Act.  The High Court held that the two items were not chargeable to tax. Counsel  for the Revenue contended that a karta in  a  Hindu undivided  family  is  a "dependant",  and  any  expenditure incurred  by the karta even out of his separate  estate  for his  own  needs or pleasures is expenditure  incurred  by  a person other than the assessee for the personal  requirement of a dependant, and is liable to be included in the  taxable expenditure  of the Hindu undivided family under s. 4(i)  of the Act. In the definition of the expression--"Dependant" in s.  2(g) (ii)(b) the expression "other member of the family" does not include a coparcener: it means wives and unmarried daughters of coparceners and widows in the family.  A karta of a Hindu family  being  expressly excluded from cl. (a),  he  is  not within 2Sup.  CI/68-- 8 594 the meaning of cl. (b) "other member of the family".  To in- clude  him  in the expression "other member of  the  family" would   make  the  exclusion  of  the  karta  in   cl.   (a) meaningless.   A  karta  of  a  Hindu  undivided  family  is therefore  not a "dependant" within the meaning of  S.  2(g) (ii) of the Act. Under  the Act a Hindu undivided family is a taxable  entity distinct   from  its  coparceners  and  other  members.    A coparcener  or other member of a Hindu undivided  family  is for purposes of assessment of the family to  expenditure-tax a person other than the assessee.  Expenditure incurred  out of the family estate, by the karta for and on behalf of  the family  is  undoubtedly expenditure by the  Hindu  undivided family  and taxable accordingly.  Expenditure incurred by  a coparcener or other member of the family out of his separate property is liable to be included in the taxable expenditure of  the  family, only if it is incurred in  respect  of  the obligations of the family, or for the personal  requirements of the coparceners or other members of the family, which  if not  incurred would have been incurred by the  family.   But every item of expenditure incurred by a corparcener or other member  of the .Hindu undivided family for his own  purposes out  of his separate property is not expenditure in  respect

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of  an obligation of the Hindu undivided family; nor  is  it expenditure  to  meet  the  personal  requirements  of   the coparceners or other members of the family.  For an item  to be included under S. 4(i) within the taxable expenditure  of a  Hindu  undivided  family, it must  be  incurred  for  the collective  obligation  of the family, or for  the  separate personal requirements of the coparceners or other members of the  family in their capacity as members of the  family  The karta of a Hindu undivided family assessed to tax under  the Expenditure-tax   Act  is  by  the  express  words   of   S. 2(g)(ii)(b).  not  a  dependant,  and  when  expenditure  is incurred  by a karta out of his separate estate for his  own purposes,  even though the family would have been liable  to meet that expenditure if the expenditure were not  incurred, the  expenditure  will,  prima facie, not be  liable  to  be included in the taxable expenditure of the family. Counsel for the Revenue contended that the Parliament  could not  have  intended,  in  the  computation  of  the  taxable expenditure  of  a Hindu undivided family,  to  exclude  the expenditure for the personal requirement of the karta,  when expenditure   for   the  personal   requirement   of   other coparceners  and  members  of the family  is  liable  to  be included.    He  submitted  that  the  distinction   between expenditure  for personal requirement of the karta  and  ,of other coparceners of the family, from property not belonging to the family is based on no rational principle, and on that account the definition of dependant in S. 2(g) must be held 595 inapplicable in the interpretation of the Act.   Undoubtedly the definitions in s. 2 of words and expressions used in the Act apply unless the context otherwise requires, and if  the context  in s. 4 requires that the expression  "  dependant" should not be given the meaning which is assigned thereto by the  definition  in  cl. (g) of s. 2,  the  Court  would  be justified  in discarding that definition.  It is  a  settled rule of interpretation that in arriving at the true  meaning which is assigned thereto by the definition in cl. (g) of to be  viewed isolated from its context; it must be  viewed  in its whole context, the title, the preamble and all the other enacting  parts of the statute.  It follows  therefrom  that all  statutory  definitions  must be  read  subject  to  the qualifications  expressed  in the definition  clauses  which create   them,  such  as  "unless  the   context   otherwise requires"; or "unless a contrary intention appears"; or  "if not  inconsistent with the context or subject-matter".   But there  is  nothing in the scheme of the Act  which  suggests that  the expression "dependant" in s. 4(i) of the  Act  was used  in  a different sense.  Section 4(i)  is  intended  to include  expenditure  incurred directly or indirectly  by  a person   other  than  the  assessee  for   discharging   any obligation  or for personal requirement of the  assessee  or dependant  of  the  assessee.  The  clause  applies  in  the computation of the expenditure of an individual as well as a Hindu  undivided  family.   It  is  not  claimed  that   the definition in s. 2 (g) (i) does not apply to the computation of  the  taxable  expenditure under s. 4  of  an  individual assessee  :  it  is  only  contended  that  a  part  of  the definition  in  s.  2  (g)  (ii)  does  not  apply  to   the interpretation  of  s.  4  (i).  When a  karta  of  a  Hindu undivided family incurs expenditure out of the joint  family property  to  discharge  an obligation  of  the  family  the expenditure is clearly by the Hindu undivided family, for in that case the karta must be deemed to be acting in incurring the  expenditure  for and on behalf of the  Hindu  undivided family.    When  the  karta  incurs  expenditure   for   the

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coparceners or other members out of his separate estate  and for that expenditure the family would have been liable if it had  not been incurred, the expenditure will be included  in the  taxable  expenditure  of  the  family.   But  when  the expenditure  is  incurred by the karta out of  his  separate estate for his personal requirements it will not be included even  if  the family would have been liable  to  incur  that expenditure if it had not been incurred.  This may apparent- ly  be anomalous.  But that is not a ground for  attributing to  the expression "dependent" a wholly  artificial  meaning different from its statutory definition.  No coparcener in a Hindu  undivided family is a dependant of the family: he  is an owner of the entire property of the family in common with the  other coparceners.  His rights arise on birth into  the family,  and  so  long  as the  family  remains  joint,  his interest  in the property is no whit less than the  interest of any other coparcener. 596 The  Parliament  in  devising a special  definition  of  the expression "dependant" has included therein all  coparceners except the karta.  If it be that the definition given in  s. 2  (g)  is  not to apply in interpreting s. 4  of  the  Act, expenditure  incurred for the personal requirements  of  all the coparceners would have to be excluded.  But that is  not the  contention of the revenue.  No rule  of  interpretation permits  for  the  purpose  of  S.  4(i)  of  the  Act   the application  of the statutory definition of  "dependant"  to bring  within the net of taxation, expenditure incurred  for coparceners  other than the karta, and of a special  meaning of that expression inconsistent alike with the personal  law of the parties, and the statutory definition to bring within the  net  the expenditure for the karta.  The  Court  cannot attribute  two different meanings to a single expression  in its application to two different situations contemplated  by a  single  clause.   The case is one  clearly  of  defective draftsmanship.   In  ss.  5  & 6  wherever  it  was  thought necessary,  having  regard to the special  relation  between members  of  a Hindu undivided family,  the  Parliament  has restricted   the  use  of  the  expression  "dependant"   to individual assessees, and has used different phraseology  in defining exclusions and deductions in computing the  taxable expenditure  of  assessees : see s. 5 (r); s.  6(c)(ii);  s. 6(f)(ii);  S.  6(g)  and s. 6(h).  In  s.  4,  however,  the Parliament has in seeking to attain undue brevity failed  to make  provision  for  inclusion in  computing  the  ,taxable expenditure of a Hindu undivided family expenditure incurred by  the karta out of his separate estate, which  expenditure would  have  been  incurred  by the family  if  it  was  not incurred by the karta. Expenditure  incurred by Surendra out of his  separate  pro- perty  cannot therefore be taken into account  in  computing the  taxable expenditure of the Hindu undivided  family,  in the  absence  of  a finding that  expenditure  was  incurred either for the obligation of the family, or for the personal requirements  of  the other coparceners or  members  of  the family,  which would have been incurred by the family if  it had not been incurred by Surendra. The  amount  of  Rs. 10,321/-  consists  of  two  components expenditure incurred out of the trust estate of the children of  Surendra, and out of their personal estate.  It  is  not clear from the finding recorded by the Tribunal whether  the expenditure  was incur-red by the children of Surendra  from the income received from the trust estate, or whether it was incurred on behalf of the children by the trustees.   Clause 2(b)  which  is  common  to all the  three  deeds  of  trust

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provides  that the trustees shall ,,pay, spend or apply  the residue  of  the trust income to and after  the  beneficiary until the beneficiary attain the age of twenty-one 597 years for or towards the maintenance, education, advancement in life, religious ceremonies, marriage, welfare and benefit of  the beneficiary in such manner as the trustees shall  in their  absolute and uncontrolled discretion deem  fit."  The Tribunal  has  in the statement of the case stated  that  in accordance  with  the  terms of the  trust  settlement,  the "trustees  had  paid,  spent or applied the  income  in  the account  year 1957." That finding of the Tribunal is  vague. But the position in law in any one of the three alternatives is plain.  If the trustees incurred the expenditure for  the education,   maintenance,  advancement  in  life.   or   for religious ceremonies, the case would clearly fall within the terms  of s. 4 (i), for there can be no doubt that  the  ex- penditure  would be deemed to be incurred by a person  other than  the  assessee  the Hindu  undivided  family,  for  the dependants  to  discharge obligation which  the  family  was bound to discharge.  If it be held that the expenditure  was incurred  by  or  on behalf of the  children  after  it  was received  from  the  trustees, the case,  in  our  judgment, would,  even if it be assumed that it does not  fall  within cl. (i), fall within the terms of cl. (ii).  The trusts were created  by Surendra out of the family funds;  the  children were  dependants  within  the meaning of s.  2(g);  and  the expenditure  was incurred for the benefit of the  dependants of  the family.  We arc unable to agree with the High  Court that the dependant who incurs expenditure, to bring the case within  the  terms  of  s. 4(ii), must  be  other  than  the dependant  who obtains the benefit of that expenditure.   In our view, the High Court was in error in observing that  the expenditure contemplated under cl. (ii) of s. 4 is one which enures for the benefit of a person other than the person who incurs  the expenditure.  If expenditure was incurred  by  a dependant  for his own purposes or benefit out of any  gift, donation  or settlement on trust or out of any other  source made  or  created by the Hindu undivided, family,  the  case clearly fell within the terms of s. 4(ii) before the  clause was  amended by the Finance Act, 1959.  There is nothing  in the  Act  to  show that the application of  the  clause  was restricted   to  cases  in  which  the  dependant   incurred expenditure for another dependant. Turning  now to Civil Appeal No. 2524 of 1966  which  arises out  of  the reference to the High Court  on  two  questions framed  in  language  identical with  the  language  of  the questions in the main appeal, but with different amounts  of expenditure  relating to the assessment year 1959-60, it  is unnecessary  to  set  out the different  components  of  the taxable expenditure incurred by the Hindu undivided  family, expenditure   incurred  from  the  trust  estate,  and   the expenditure incurred by Surendra in his individual capacity. The questions raised are only about 598 the  liability  to  tax: the figures  are  not  in  dispute. Section  4,  as it stood in the year of  assessment  1959-60 read as follows:               "Unless  otherwise provided in section 5,  the               following   amount   shall  be   included   in               computing  the  expenditure  of  an   assessee               liable to tax under this Act, namely :-               (i)   any   expenditure   incurred,    whether               directly  or  indirectly by any  person  other               than the assessee in respect of any obligation

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             or personal requirement of the assessee or any               of his dependants, to the extent to which  the               amount   of  all  such  expenditure   in   the               aggregate exceeds Rs. 5,0001in any year;               (ii)  where the assessee is an individual, any               expenditure  incurred by any dependent of  the               assessee,  and where the assessee is  a  Hindu               undivided family, expenditure incurred by  any               dependant  from  or  out  of  any  income   or               property transferred directly or indirectly to               the dependant by the assessee." Clause (i) is a reproduction of the original clause, subject the  deletion  of the words "which but for  the  expenditure having  been incurred by that other person, would have  been incurred by the assessee." In our view, the words which were deleted  did  not  add  to the  meaning  of  the  expression "obligation  or personal requirement of the assessee or  any of  his dependants".  Expenditure which was not  related  to any obligation or personal requirement of the dependants  in their  capacity as dependants did not fall within the  terms of  s.  4(i) before it was amended.  The words to  which  we have  already referred, were a surplusage: by deleting  them no  intention to alter the meaning of the original  cl.  (i) may be attributed to the Legislature. We  are  of  the view, for the reasons already  set  out  in dealing   with  the  assessment  year  1958-59,   that   the expenditure incurred by Surendra out of his personal  estate is not liable to be included in the taxable expenditure  for the  year 1959-60.  If the amount expended from out  of  the trust  estate  be held, for reasons already set  out  to  be expended by the trustees, the case falls within the terms of cl. (i): if it be held that the expenditure was incurred  by or  on behalf of the children after the income was  received from  the  trustees  it would fall  within  cl.  (ii).   The Legislature  has  by  the  amended  clause  (ii)   expressly provided  that  where  the assessee  is  a  Hindu  undivided family,  any  expenditure incurred by any dependant  of  the assessee  from or out of any income or property  transferred directly or indirectly to the depen- 599 dant  by the assessee, is liable to be included.  The  words are not susceptible of the interpretation that the dependant who incurs the expenditure must be other than the  dependant to  whom  the  property  is  transferred  by  the  assessee. Expenditure  incurred for his own purposes by the  dependant to  whom the property is transferred by the Hindu  undivided family clearly falls within s. 4 (ii) as amended. We therefore modify the order of the High Court.  The answer to the first question for each year will be in the negative. The   answer  to  the  second  question  will  be   in   the affirmative.   It  must, however, be  understood  that  this answer  does  not imply that the amount of Rs.  10,321/-  in respect of the assessment year 1958-59 was the amount  spent by the trustees.  In disposing of the appeal under s.  25(6) of   the  Expenditure-tax  Act,  the  Tribunal   must   make appropriate  adjustments in declaring the liability  of  the assessee  to pay tax in respect of the expenditure  incurred from the trust estate by the trustees after making the  per- missible deductions under ss. 5 & 6 of the Act.  In view  of the  partial success, there will be no order as to costs  in this Court and in the High Court. V.P.S.                                                 Order modified. 600

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