Conduct of undivided business entrusted to agent.

JAGADISAN J.

One Mohamed Rowther of Muthupet in Tanjore district migrated to Penang in 1938 and carried on a lighterage business in the Penang Harbour. He married two wives in India, by whom he had nine children. For the sake of convenience, we would refer to them in this judgment as the Indian heirs. He also married a Malayan wife and had a son by her. This wife and son, would be referred to in this judgment as the Malayan heirs. Mohamed Rowther had a successful business career, and, besides the lucrative business at Penang, he came to own large extent of house properties and agricultural lands in India. During his absence in Malaya, his son-in-law, one Dawood Ghani, was managing the properties in India under a power of attorney Mohamed Rowther executed his last will and testament on 9th August, 1943, and died on 17th August, 1943. His estate devolved upon the two Indian wives, their nine children, the Malayan wife and her only son. Under the will, he had, however, appointed three executors and trustees to administer the Properties belonging to him until they were divided and distributed to his heirs-at-law ; and they were (1) Amir Mohideen, (2) Mohamed Noorudeen and (3) Sheik Ahmed. Penang was under Japanese occupation at the time of Mohamed Rowther's death and for some time thereafter. The executors obtained probate of the will from the Japanese court on 12th December, 1944. After the British re-occupation some time in 1945, this probate was confirmed by the British court. All the three executors, however, did not take up the management of the estate of the deceased, Mohamed Rowther. It was only Amir Mohideen who appears to have carried on the lighterage business in his capacity as executor till it was taken over by the power of attorney agent of the Indian heirs on 18th December, 1946. The news of the death of Mohamed Rowther was received by the Indian heirs only after the British re-occupation in 1945. On 3rd September, 1945, the Indian heirs remitted a sum of dollar 15, 000 through the Indian Overseas Bank Ltd., to the executors to enable them to carry on the lighterage business. Hameed Sultan, the eldest son of the deceased Mohamed Rowther, and Dawood Ghani, his son-in-law, left India on or about 10th June, 1946, for Penang. A power of attorney was executed in favour of Dawood Ghani and Hameed Sultan by the Indian heirs on 26th August, 1946. Actually, the management of the business at Penang was taken over by these power of attorney agents from the functioning executor, Amir Mohideen, on 18th December, 1946. Dawood Ghani returned to India on 25th June, 1947, and again left for Malaya in November, 1948. Hameed Sultan appears to have been staying on at Penang from 1946 onwards The Income-tax Officer, Nagapattinam, assessed the income of the estate of the deceased, Mohamed Rowther, in the hands of his heirs and legal representatives for the calendar years 1945, 1946, 1947 and 1948, the previous years relevant to the assessment being 1946-47, 1947-48, 1948-49 and 1949-50. His heirs, Indian as well as Malayan, were treated as an association of persons under the Indian Income-tax Act, and the entire income of the estate was brought to tax, treating the association as the unit of assessment. The contention raised on behalf of the Indian heirs that they were merely co-heirs of a deceased Mohammedan, that they did not constitute an association of persons, and that the assessment should be made as against each heir in respect of his or her share income was negatived by the Income-tax Officer. Their further plea that they should be treated as non-residents also did not find favour with the officer. The following tabular statement gives the particulars of the income, Indian and foreign, of the estate during the relevant assessment yearsrevious year Assessment Indian Foreign Total

year income

Rs. Rs. Rs

Calendar year 1945 1946-47 1, 440 5, 454 6, 894

"1946 1947-48 1, 440 22, 908 24, 348

" 1947 1948-49 1, 440 55, 659 57, 099

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