Judgment

GAJENDRAGADKAR, C.J.I. : The common question of law which this group of six appeals raises for our decision is whether S. 3 of the Wealth Tax Act, 1957 (No. 27 of 1957) (hereinafter called the Act ) in so far as it purports to levy a charge of wealth tax in respect of the net wealth of a Hindu undivided family at the specified rate, is valid. The respective appellants in these appeals who constitute Hindu undivided families were charged under S. 3 and they challenged the validity of the said charge on the ground that the said section was ultra vires. The writ petitions filed by these appellant; were heard by a Special Bench of the Allahabad High Court consisting of Gurtu, Upadhya and Jagdish Sahai, JJ. Gurtu and Jagdish Sahai, JJ. have rejected the appellants contention and have upheld the validity of the impugned provision. According to Jagdish Sahai, J., the impugned section is intra vires, because Parliament had legislative competence to enact the ; said provision under Entry 86, List I of the Seventh " Schedule to the Constitution. Gurtu, J. who agreed with the said conclusion, however, sustained the impugned provision under Entry 97 in List I read with Art. 248 of the Constitution. Upadhya, J. .held that neither of the said provisions conferred legislative competence on Parliament to enact the impugned provision, and so, he came to the conclusion that, the said provision was ultra vires and the charge levied against the appellants was, therefore, invalid. In accordance with the majority decision, the writ petitions filed by the respective appellants were dismissed. The appellants then applied for and obtained certificates from the said High Court, and it is with the certificates issued in their favour that they have come to this Court in appeal.

2. The Act was passed in 1957 to provide for the levy of wealth tax. Section 3 of the Act provides that 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, 1957, a tax (hereinafter referred to as wealth tax) in respect of the act wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in the Schedule. The three Constitutional provisions relevant to the decision of the point raised before us in these appeals may now be set out.

3. Entry 86 in List I deals with taxes on the capital value of the assets, exclusive of agricultural land, of individuals and companies; taxes on the capital of companies. Entry 97 in the said List refers to any other matter not enumerated in List II or List III including any tax not mentioned in either of those Lists. Art. 248 reads thus : ----

"(1) Parliament has exclusive power to make any law with respect to any matter not enumerated in the Concurrent List or State List.

(2) Such power shall include the power of making any law imposing a tax not mentioned in either of those Lists;;

4. The appellants contend that the word "individuals" used in Entry 86 cannot take in Hindu undivided families. The taxes which Parliament is empowered to levy under this Entry can be levied only on individuals and not on groups of individuals, and on companies. A Hindu undivided family consists of different coparceners who are, no doubt, individuals, but in asmuch as the impugned provision purports to levy wealth tax on the capital value of the assets of the Hindu undivided families as such, the tax is not levied on individuals, but on groups of individuals, and, therefore, is outside the scope of Entry 86. The appellants further urge that if the Hindu undivided families are outside the scope of Entry 86, they cannot be subjected to the levy of wealth tax under Entry 97, because entry 97 refers to matters other than those specified in Entries 1 to 96 in List I as well as those enumerated in Lists II and III. Since, wealth tax is a matter which is specifically enumerated in Entry 86 of List 1, Entry 97