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HIGH COURT OF CALCUTTA
Harries, Banerjee
COMMR. OF INCOME-TAX, WEST BENGAL - Appellant
Versus
ADMINISTRATOR-GENERAL OF BENGAL, CALCUTTA - Respondent
Income-Tax Ref 39 Of 1950
Decided On : DECEMBER 12, 1950
INCOME TAX ACT, 1922 - S. 4(3)(i) - PUBLIC RELIGIOUS TRUST - TEST - TRUST CREATED BY WILL FOR WORSHIP OF DEITIES ESTABLISHED BY TESTATOR IN HIS HOUSE - NO PUBLIC ACCESS OR RIGHT TO WORSHIP - NOT A PUBLIC RELIGIOUS TRUST - NOT EXEMPT FROM TAXATION UNDER S. 4(3)(i).
Fact of the Case:
The testator, Manicklal Dutt, made a will in 1927, creating a trust for the worship of deities established by him in his house in Calcutta. The will provided for the appointment of shebaits to manage the trust and for the performance of daily worship and annual ceremonies. The testator also directed that the poor and Atithis should be fed in connection with the ceremonies. The question before the court was whether the trust was a public religious trust and therefore exempt from taxation under Section 4(3)(i) of the Income Tax Act, 1922.
Finding of the Court:
The court held that the trust was not a public religious trust and was therefore not exempt from taxation. The court found that the testator did not intend to dedicate the Thakurbati to the public or to make it a public religious trust. The court noted that the testator had used the word "public" in other paragraphs of the will, but he did not use it in reference to the trust created in paragraph 9, which established the Thakurbati. The court also noted that there was no evidence that the public had any access to the Thakurbati or had anything to do with the management of the Thakurbati or the worship of the deities.
Issues: Whether the trust created by the will was a public religious trust and therefore wholly exempt from taxation under Section 4(3)(i) of the Income Tax Act, 1922.
Ratio Decidendi: To determine whether a trust is a public religious trust, the court must consider the intention of the testator as expressed in the will. In this case, the testator did not intend to dedicate the Thakurbati to the public or to make it a public religious trust. The court also noted that there was no evidence that the public had any access to the Thakurbati or had anything to do with the management of the Thakurbati or the worship of the deities.
Final Decision: The court held that the trust was not a public religious trust and was therefore not exempt from taxation.
( 1 ) THIS is a reference under Section 66, Income-tax Act. The question referred to us is as follows:"whether on a proper construction of the will dated 12-8-1927, made by Manicklal Dutt, the Tribunal was right in holding that the Trust created by the will was a public religions trust and therefore wholly exempt from taxation under Section 4 (3) (i)?"
( 2 ) MANICKLAL Dutt in his lifetime was a Hindu governed by the Dayabhag and lived at premises No. 31 Hidaram Banerjee Lane. He had an undivided half share of and in a dwelling house in Raja Kisory Mohan Goswami Street in Serampore which was the family dwelling house. He had other immovable properties and was possessed of various movable properties, such as Government securities, bonds, shares, etc. He made his last will and testament on 12-8-1927. The testator was a widower. He had no son or daughter and it appears from the will that he intended to make gift of the whole of his estate for charitable and religious purposes for the spiritual benefit of himself, his ancestors, his father-in-law and mother-in-law. The material clauses of the will are as follows:"1. I do hereby revoke all wills and testamentary dispositions heretofore made by me. I have cancelled my registered will dated the ninth day of September one thousand nine hundred and twenty four and I declare this to be my last Will. 2. I do hereby appoint the Administrator General of Bengal and his successor or successors in office for the time being to be the sole Executor and Trustee of this my Will (hereinafter referred to as my Executor and Trustee ). 3. I give, devise and bequeath whole of my estate both moveable and immoveable which I am possessed of or may be entitled to at the time of ray death unto my executor and Trustee upon the trusts and for the purposes hereinafter mentioned. 4. I direct that my said Executor and Trustee shall take possession of the whole of my estate and shall sell and convert into cash all my moveable and immoveable properties save and except the house and premises No. 31, Hidaram Banerjee Lane, in the town of Calcutta until a suitable and more commodious Thackoorbati is built as hereinafter provided and also save and except my half share of and in my said family dwelling house and land in Benapara in Serampore and the tenanted shop rooms in the Bazar in Serampore and invest the same after payment thereout of my just debts, funeral tesiamentary and Sradh expenses into three and a half per cent. Government Securities. 5. I declare that I have established and installed deities of Thackoors Radhakanto Jiu and Gopal Jiu in the said house and premises, No. 31, Hidaram Banerjee Lane. The said house and premises No. 31, Hidaram Banerjee Lane, shall until another Thackoorbati is built as hereinafter provided be used as the Thackoorbati for the location of the said Thackoors and I direct that a tablet bearing the inscription 'srimati Sowdamini Dassee Thackoorbati established by Manicklal Dutt' to be put up on the said premises. 6. I direct my Executor and Trustee to set apart and spend out of my estate a sum not exceeding Rupees forty five thousand for buying a suitable plot of land in the town of Calcutta measuring not less than four to five cottahs and build a suitable Thackoorbati thereon for the location and habitation of the said deities Radhakanto Jiu and Gopal Jiu or to buy a ready made house with land measuring not less than four cottahs in a good locality suitable for a Thackoorbati for the location and habitation of the said deities at a price which together with the expenses that may be incurred for making additions and alterations thereto shall not exceed the sum of Rupees forty five thousand. After a new Thackoorbati is built or purchased a tablet bearing the inscription 'srimati Sowdamini Dassee Thackoorbati established by Manicklal Dutt' shall be put up on the said premises and the said Thackoorbati together with the land appertaining thereto shall be the absolute prop
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