SUHAS CHANDRA SEN, J.

( 1 ) THE following two questions of law have been referred to this court by the Tribunal under Section 256 (1) of the Income-tax Act, 1961 ("the Act") :" (1) Whether, on the facts and in the circumstances of the case and on a proper interpretation of the deed of endowment dated April 28, 1896, the Tribunal was right in holding that the individual shares of the deities in whose favour the endowment had been made were not indeterminate or unknown and that accordingly the first proviso to Section 41 (1) of the Indian Income-tax Act, 1922, and Section 164 of the Income-tax Act, 1961, was not applicable to the income from the property dedicated by the said deed ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the Additional Commissioner was not justified in coming to the conclusion that the assessments were prejudicial to the interests of the Revenue ?"

( 2 ) THE reference relates to the assessment years 1958-59 to 1972-73.

( 3 ) THE dispute in the instant case is with regard to the method of assessment of properties which were dedicated to a number of deities. The properties under consideration were assessed in the hands of the shebait Pulin Chandra Daw for the assessment years 1952-53, 1953-54 and 1954-55. The correctness of the assessments in those years came up for consideration before this court in the case of CIT v. Pulin Chandra Daw [1967] 63 ITR 179, 181, the question there being :"whether, on the facts and in the circumstances of the case, and on a proper construction of the deed of dedication, dated 17th Baisakh, 1303 B. S. (28th April, 1896), the income from the properties covered by the said deed was assessable under Section 9 of the Indian Income-tax Act in the hands of the respondent-assessee ?"

( 4 ) ON consideration of the arpannamah, it was held that though the assessee, as shebait, might have been in custody of the property and might have the right to manage it, he was not the owner of the property and was not liable to be Assessed to tax in respect of the property under Section 9 of the Indian Income-tax Act, 1922 ("the 1922 Act" ). It was held that under Hindu law, the property had vested in the idol which was a juristic person. Under the 1961 Act provision had been made to assess the deities.

( 5 ) RELIANCE was placed on an earlier decision of this court in the case of CIT v. Pulin Behari Dey [1951] 20 ITR 314, 315, where the question was as under :"whether, on the facts and circumstances of this case, the Appellate Tribunal were right in holding that although the shares of the two deities are not denned in the deed of endowment, their shares are defined in law, that is, they are equal, and, therefore, the first proviso to Section 41 is inapplicable ?"

( 6 ) IT was held that where the shares of the deities were indeterminate, the assessments should be made under Section 41 of the 1922 Act at the maximum rate. In the instant case, the shares of the deities are not indeterminate. It has been held by the Division Bench of this court in the case of Pulin Behari Dey [ 1951 ] 20 ITR 314 that the grant and the devise to the two deities were made without specification of shares ; they took in equal shares ; when the shares of the deities were certain and it was known what properties were given to the deities in equal shares, then the first proviso to Section 41 was inapplicable.

( 7 ) THE Tribunal has followed the principle of law laid down by this court in that case and held that where there were no specifications of shares of the deities, they took in equal shares. The assessments should be made separately in the hands of the deities.

( 8 ) WE do not find anything wrong in law in the principle followed by the Tribunal.

( 9 ) MR. Moitra, appearing for the Revenue, has argued that there is material difference between the provisions of Section 41 of the 1922 Act and Section 164 of the 1961 Act, but in the context of the facts of this ca

Click Here to Read the rest of this document