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PETITIONER: THE OFFICIAL TRUSTEE OF WEST BENGAL  FOR THE TRUST OF CHITRA

       Vs.

RESPONDENT: C.I.T WEST BENGAL, CALCUTTA

DATE OF JUDGMENT04/12/1973

BENCH: ALAGIRISWAMI, A. BENCH: ALAGIRISWAMI, A. RAY, A.N. (CJ) KHANNA, HANS RAJ MATHEW, KUTTYIL KURIEN BHAGWATI, P.N.

CITATION:  1974 AIR 1355            1974 SCR  (2) 383  1974 SCC  (3) 616

ACT: Income-tax  Act (11 of 1922), s. 3-’Individual’,if  includes all Hindu deity

HEADNOTE: On  the  question whether a Hindu deity is  an  ’individual’ within the meaning of that word under the provisions of  the income tax Act, 1922. HELD  : A Hindu deity falls within the meaning of  the  word ’individual’  in  s.  3  and can  be  treated  as  ambit  of assessment.   It  would naturally be taxed through  its  she baits who are in possession and management of its  property. [587-C] As a result of the decision of the Bombay High Court in C.T. v  Ahmedabad  Mill Owners, Association, 7  I.T.R.  369  that individual in s. 3 of the Income tax Act,. 1922, must mean a human  being, the income-tax (Amendment) Act, 1939,  amended the  words "association of individuals" in the section  into "association  of persons"; but the word  individual’,  being the  first  of  the six assessable units  mentioned  in  the section, was retained and was not amended into ’person’.  It was  not changed into "person" because the word ’person’  is of  wider import and includes any company or association  or body  of  individuals whether in corporated or not.   So,  a word  had  to be chosen which would not carry  with  it  the wider  import of the word ’Person’ and the  word  individual was  retained.   After the amendment it was pointed  cut  by this  Court in Commissioner of Income tax v. Sodra Devi  (32 I.T.R. 615) that the word individual not only means a  human being,  but  also  includes  a  corporation   created  by  a statute.   A  Hindu deity is a juristic  person  capable  of holding property.  As it can hold property and be in receipt of  Income  and can also sue and be sued in a court  of  law there is no reason why its income should be held to be  out- side the ambit of taxation since it can be brought within it without  straining the language of the statutory  provision. [586E-H; 587B-C] Jogendra  Nath  Naskar  v. Comr. of  Income-tax  (1969)  74, I.T.R. 33 (S.C.), followed

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Commissioner of Income tax V. Salem District Urban Bank Ltd. 8  I.T.R.  269,  Commr. of Income-tax v.  Bar  Council,  12, I.T.R.  1, Sir Currimbhoy Ebrahim Baronetcy Trust v.  Commr. of Income-tax, 5. I.T.C. 484, referred to. I.T.C.  v.  Jogendra  Nath, A.I.R. 1965  Cal.  570  and  Sri Sridhar v. I.T. Office)’.  A.I.R, 1966 Cal. 494, approved.

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 2358-2366, of 1968 & 1174, 1288-1299 of 1971. From  the judgment and Order dated the 4th January, 1966  of the,  Calcutta High Court in Income Tax Reference No. 25  of 1968. Purshotham Chatterjee, P. K. Chakravarthy and Prodyot  Kumar Chakravarthy, for the appellant. V.  S.  Desai,  S.K.  Aiyer and  R.  N.  Sachthey,  for  the respondent. The Judgment of the Court was delivered by ALAGIRISWAMI,  J. The question that arises for  decision  in these,appeals  is whether a Hindu deity is  an  "individual" within the meaning, of that word under the provisions of the Indian Income-tax Act, 1922.  It arises out of the  judgment of  the  High Court of Calcutta in a  number  of  references under section 66(1) of the Act.  The facts necessary for the decision,  in a short compass, are these : In the year  1820 one Smt. 584 Chitra Dassi executed an Ekrarnama making a gift of a  piece of land for religious Purposes.  In 1842 she executed a will referring to the fact that she had-earlier made the property debutter  and  directed  her four sons,  the  executors,  to perform  the daily service of Sri Radhagobindjee.  She  died in  1855.   In 1876 a suit was filed in  the  Calcutta  High Court  praying that the trust should be administered by  the court  and  a scheme prepared.  Subsequently, there  were  a number  of applications made from time to time and a  number of  orders  were  also made on them.  In 1929  a  scheme  of administration  was framed and a little later the  (Official Trustee  of  Bengal was appointed to be the trustee  of  the said  debutter  estate.  After the-  official  trustee  took possession  of the properties he was assessed in respect  of the  income  of  the debutter estate in  the  status  of  an "individual" under section 41 of the Act.  In respect of the assessment  years  1939-40 to 1942-43 a reference  was  made under  section  66(2) of the Act.  A Bench of  the  Calcutta High  Court  held that upon a proper  construction  of  the, relevant  documents  and the scheme  sanctioned  and  orders passed by the High Court the property should be held to be a religious trust.  The matter again went up to the High Court in respect of the assessment years 194344 to 1951-52.  Three questions finally came to be considered by the High Court :               Q.1 Whether upon a proper construction of  the               relevant  documents executed by  Smt.   Chitra               Dassi and the relevant schemes sanctioned  and               orders  passed by the High Court, there was  a               trust in favour of the Deity or whether  there               was  a  dedication of the properties  -to  the               Deity ?               Q.2  Alternatively, if the dedication  to  the               Thakur  constitute  trust, is it  a  religious               trust  which did not enure to the  benefit  of               the public ?               Q.3 Is the Thakur Radha Gobinda Jew liable  to

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             assessment under the Indian Income-tax Act ? On  question  No. 1 the High Court held that upon  a  proper construction  of the relevant documents executed  by  Chitra Dassi and the relevant Schemes sanctioned and orders  passed by  the High Court there was a dedication of the  properties to  the deity, but that there was no trust in the  technical sense, that is to say, as understood in the English law.  in respect  of the first part of the 2nd question both  parties before the High Court agreed that in that question the  word "trust" did not mean a trust in the technical or the English sense.   The  High Court pointed out that it has  been  held that a dedication is a trust in the general sense within the meaning  of the expression as used in sections 4, 40 and  41 of the Income-tax Act and the word "trust" can be applied to Hindu endowments.  On the second part of the question it was held that the endowment is a private religious trust and the documents  creating it or confirming it grant no benefit  to the  members  of  the  public, that an  order  made  by  the Calcutta High Court by which 585 certain directions were given for feeding the poor, was  the only  instance in which a benefit enured to the public.   As regards   the  3rd  question  the  High  Court   elaborately discussed  whether  the  deity  could  be  held  to  be   an "individual"   and  held  that  the  deity  was  liable   to assessment under the Income-tax Act. Before this Court the only point argued was whether the High Court was right in coming’ to the conclusion that the  deity is  an  "individual".  When the High Court dealt  with  this question  it  did not have: the benefit of the  decision  of this Court in Jogendra Nath Naskar v.. Commr. of  Income-tax (1969-74  ITR  33) wherein it was held that  a  Hindu  deity falls within the meaning of the word "individual" in section 3  and  can  be  treated  as  a  unit  of  assessment.   Mr. Chatterjee arguing for the appellant urged that decision was wrong  and  should, be reconsidered.  We find  ourselves  in entire agreement with the decision of this Court referred to above.  We shall, however, state our reasons within a  short compass. it was conceded before us on behalf of the appellant that if the word used had been a "person" instead of an "individual" the deity would be a person because a person will include  a juristic person.  That a Hindu deity is a juristic person is a  well established proposition and has been so for  a  long time.   In  Maharanee  Shibessouree  Debia  v.  Mothooranath Acharjo (1869 13 MIA 270) it was observed :               "The  Talook itself, with which  these  Jimmas               were connected by tenure, was dedicated to the               religious  services, of the Idol.   The  rents               constituted,   therefore,   in   legal    con-               templation, its property.  The Sabait had  not               the  legal  property, but only  the  title  of               Manager of a religious. endowment."               In Prosunno Kumari Debya V. Golab,Chand  Baboo               (1875 LR 2 IA 145) the above observations were               cited  with  approval.  In Manohar  Ganesh  v.               Lakhmirmn  (1887 ILR 12 Bom. 247)  a  Division               Bench of the Bombay High Court observed :               "The  Hindu law, like the Roman law and  those               derived   from   it,  recognises,   not   only               corporate  bodies  with  rights  of   property               vested  in  the  corporation  apart  from  its               individual  members,  but also  the  juridical               persons  or subjects called  foundations......               it  is consistent with the giants having  been

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             made  to  the juridical person  symbolized  or               personified in the idol........               The  Madras  High Court in  Vidyapurna  Tirtha               Swami v. Vidyanidhk Tirtha Swami (1904 ILR  27               Mad. 435) expressed the view :               "It is to give due effect to such a sentiment,               widespread  and  deeprooted as it  has  always               been, with reference to something not  capable               of holding property as a natural person,  that               the laws of most countries have sanctioned the               creation of a fictitious person in the matter,               as is implied               586               in the felicitous observation made in the work               already  cited  : ’Perhaps the oldest  of  all               juristic  persons  is  the God,  here  or  the               saint."               in  Pramatha Nath Mullick v.  Pradyumna  Kumar               Mullick (1925 LR 52 IA 245 ; AIR 1925 PC  139)               the Privy Council observed               "A   Hindi   idol  is,   according   to   long               established   authority   founded   upon   the               religious  customs  of  the  Hindus,  and  the               recognition  thereof  by  courts  of  law,   a               ’juristic  entity’. it has a juridical  status               with  the power of suing and being sued.   Its               interests  are attended to by the  person  who               has the deity in his charge and who is in  law               its  manager with all the powers which  would,               in such circumstances, on analogy, be given to               the  manager of the estate of an infant  heir.               it  is unnecessary to quote the authorities  ;               for  this  doctrine, thus  simply  stated,  is               firmly established."               The  authorities thus amply establish  that  a               Hindu   deity is a juristic person  capable of               holding property.               Reference was made to the decision in C. L  T.               v.  Ahmedabad Mill Owners’ Association (7  ITR               369) where Beaumont, C. J. held :               "Individual" where first used, must mean human               being.   because  it  is  used  as   something               distinct   from  a  joint  family.  firm   and               company.  The whole expression seems to me  to               mean  "every  human  being,  Hindu   undivided               family, company, firm and other association of               human beings." Though  in  consequence  of  this  decision  the  Income-tax (Amendment)  Act,  1939 amended the  words  "association  of individuals"   into  "association  of  persons".  the   word "individual"  being  first  of  the  six  assessable   units mentioned in section 3 was retained and was not amended into "Person".  it  could not be changed into  "person"  for  the obvious reason that the word "person" is of wider import and includes any company or association or body of  individuals, whether  incorporated or not.  So a word had to  be  chosen, which  would not carry with it the wider import of the  word "person"  and  the word "individual" appears  to  have  been chosen.  In Commissioner of Income-tax v. Sodra Devi (32 ITR 615) it was pointed out that the word "individual" not  only means a human being but also includes a corporation  created by  a statute, e. g. a University, or a Bar Council  or  the trustees  of a Baronetcy trust, incorporated by a  Baronetcy Act  (See  the decisions in Commissioner  of  Income-tax  v. Salem District Urban Bank Ltd.. 8 ITR 269 ; Commissioner  of

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Income-tax  v.  Bar Council, 12 ITR I ; and  Sir  Currimbhoy Ebrahim Baronetcy Trust v. Commissioner of Income-tax, 5 ITC 484).  But Dass J. observed :               "....... there is no difficulty whatsoever  in               my  opinion, in giving the  word  ’individual’               its  natural meaning, that is, that  the  word               means either a male or a female." But  the  court  in that case was  not  concerned  with  the problem  whether  the  word  "individual"  can  refer  to  a juridical entity.  Mukharji J. of 587 the Calcutta High Court in I T. Commr. v. Jogendra Nath (AIR 1965  Cal.  570) held that a Hindu deity can  be  either  an individual or a person or both.  The same High Court in  Sri Sridhar  v.  L T. Officer (AIR 1966 Cal. 494)  held  that  a Hindu idol is a juristic entity who is given the status of a human being capable of having property and it can be  called an "individual". We  are of opinion that as a Hindu deity can  hold  property and be in receipt of income and can also sue and be sued  in a  court of law there is no reason why its income should  be held  to  be  outside the ambit of taxation  if  it  can  be brought  within  it without straining the  language  of  the statutory  provision.  It would naturally be  taxed  through its  shebaits  who are in possession and management  of  its property.  We may, however, mention that the problem whether the  Hindu  deity is an individual is not  likely  to  arise after the enactment of Income-tax Act, 1961 which in  clause 31  of  section  2 defines a "person" as  including  (i)  an individual, (ii) a Hindu undivided family. (iii) a  company, (iv)  a  firm. (v) an association of persons or  a  body  of individuals,  whether  incorporated  or not,  (vi)  a  local authority. and (vii) every artificial juridical person,  not falling within any of the preceding sub-clauses. The appeals  are dismissed with costs. V.P.S.                              Appeals dismissed. 588