Rajasthan H.C : The self-acquired property of a father dying intestate after the coming into force of the Hindu Succession Act is to be treated as ancestral property in the hands of the son ?

High Court Of Rajasthan

CIT vs. M.M. Jain

Section 4

Asst. Year 1978-79

J.S. Verma, C.J. & Milap Chand Jain, J.

DB Civil IT Ref. No. 12 of 1982

27th April, 1988

Counsel Appeared

B.R. Arora, for the Revenue : S.K. Kakkar, for the Assessee

J.S. VERMA, C.J.:

This reference under s. 256(1) of the IT Act, 1961, at the instance of the Revenue is to answer the following question namely : “Whether the Tribunal was justified in law in holding that the self-acquired property of a father dying intestate after the coming into force of the Hindu Succession Act is to be treated as ancestral property in the hands of the son ? “

The relevant assessment year is 1978-79. The assessee acquired the property in dispute from his father who died in 1976. The assessee constituted an HUF at the time of the death of his father. The question arose about the nature of the property and whether this property was to be treated as ancestral in his hands or not. The ITO rejected the assessee’s contention that the property was ancestral in the hands of the assessee. The ITO assessed the property and the income of the assessee in his status as individual and not as HUF. The AAC affirmed that view. The Tribunal, on further appeal, upheld the assessee’s contention. Hence, this reference at the instance of the Revenue.

It is a settled principle of law that even the self-acquired property of a father dying intestate coming to the son is to be treated as ancestral property in the hands of the son. The Tribunal’s view was, therefore, clearly justified. Consequently, the reference is answered against the Revenue and in favour of the assessee by holding that the Tribunal’s view was justified.

No costs.

[Citation : 172 ITR 497]

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