COMMISSIONER OF Income Tax vs SMT. RAHIMA BI.

ISMAIL J. - The Income Tax Appellate Tribunal, Bangalore Bench, u/s 66(1) of the Indian Income Tax Act, 1922, hereinafter referred to as ""the

Act"", has referred the following question of law for the opinion of this court in relation to the assessment years 1950-51 and 1951-52 :

Whether, on the facts and in the circumstances of the case, the Tribunal was right is setting aside the entire assessments ?

The assessments referred to above relate to the estate of late Gundu Hafiz Mohammed Yousuff of Valathoor. The said Gundu Hafiz Mohammed

Yousuff was deriving share income from three firms and the died on January 21, 1956. For the three assessment years, namely, 1950-51, 1951-

52 and 1953-54, assessments were made by issue of notices to Rahima Bi, wife of Gundu Hafiz Mohammed Yousuff, the assessee, treating her as

the legal representative of her deceased husband. She filed returns for the assessment years 1950-51 and 1951-52. The assessments were

completed. On February 19, 1959, S. A.Samad, son by another wife of the deceased, stated that Rahima Bi was not the only legal heir and that

he and his sister by the first wife of the deceased were also heirs. The assessment for 1953-54, was completed u/s 23(3) of the Act. There was an

appeal to the Appellate Assistant Commissioner and then to the Tribunal. The contention taken on behalf of Samad and of Rahima Bi that action

u/s 24B(2) of the Act was required to be taken was upheld by the Tribunal. The Income Tax Officer then reopened the assessments for 1950-51

and 1951-52 by issuing notices u/s 34 on all the persons who included Rahima Bi, her children and the two children by the first wife. So far as the

minors were concerned, the Income Tax Officer issued notices treating Rahima Bi, the mother as their guardian. The others refused service. No

return was filed. Notice u/s 22(4) was served on Rahima Bi by affixture on March 16, 1960, posting the case to March 18, 1960. There being no

response, the assessments were completed for both the years u/s 23(4).

On appeal before the Appellate Assistant Commissioner, it was contended that there was no proper notice on the minor legal representatives, that

the Income Tax Officer acted illegally in treating the service of notice on Rahima Bi as service of notice on the minors, that under the Mohamedan

law the mother was not the legal guardian of the minors and the court alone appoint a legal guardian for them and that, in the circumstances of the

case and the Income Tax Officer not having taken steps to have a legal guardian appointed by the court, the assessments made were illegal and

must be set aside. The Appellate Assistant Commissioner upheld the assessments in the view that Rahima Bi was the de facto guardian and that the

notice served on her could be treated as proper notice served on the minors.

The assessee took up the matter in further appeal to the Tribunal and contended that Rahima Bi was not the guardian of the minor children and,

therefore, the minor children had not been properly impleaded and that the finding of the Appellate Assistant Commissioner that Rahima Bi was the

de facto guardian and, therefore, she could be treated as the de facto guardian so as to give her the right to represent the minors in tax proceedings

was wrong. On the other hand, the contention on behalf of the department was that section 24B(2) notices were issued to all the minors through

Rahima Bi, that the Income Tax Officer bona fide felt that she was the natural guardian and as she had already made a return, that was binding on

all the minors and that, at best, the non-service of notice on the minors through their legal guardian was only an irregularity and not an illegality. The

Tribunal, however, rejected this contention of the department and accepted the contention of the assessee and set aside the assessments and

allowed the appeal preferred by the assessee. It is the correctness of this conclusion of the Tribunal that is challenged in the form of the question,

extracted already, referred to this court.

It is not in dispute that in the present case it is only the provisions of section 24B(2) of the Act that applies. Section 24B(2) states :

Where a person dies before the publication of the notice referred to in sub-section (1) of section 22 or before he is served with a notice under

sub-section (2) of section 22 or section 34, as the case may be, his executor administrator or other legal representative shall, on the serving of the

notice under sub-section (2) of section 22 or u/s 34, as the case may be, comply therewith, and the Income Tax Officer may proceed to assess the

total income of the deceased person as if such executor, administrator or other legal representative were the assessee.

As we have pointed out already, the notices u/s 34 were issued after the death of Gundu Hafiz Mohammed Yousuff. Consequently, the Income

Tax Officer could proceed to make the assessments only after issuing notices to all the legal representatives of the deceased. It is not the case of

the Income Tax Officer that after he made bona fide enquiries he came to the conclusion that Rahima Bi was the only legal representative of the

deceased. The Income Tax Officer was fully aware of the fact that Rahima Bi had minor children and that they were also the legal representatives

of the deceased. Consequently, the only question for consideration is as to how the notices u/s 34 were to be served on the minor children, who

were also the legal representatives of the deceased. It is settled law, as far as Mohamedan law is concerned, that only the father or fathers father

among the relations is the de jure guardian of a minor. It is open to the said father or the fathers father to appoint testamentarily a guardian for the

minor concerned. But in the absence of the father, fathers father or the testamentary guardian so appointed, the de jure guardian can be appointed

only by a court. No other relation of a minor can claim to act as a de jure guardian of a minor so as to deal with the minors property. In this case, it

is not the contention of the department that the father of the deceased was alive and he was the de jure guardian of his minor grandsons or that

Gundu Hafiz Mohammed Yousuff or his father had appointed testamentarily a guardian for the minor children in question. Under these

circumstances we must proceed on the basis that the minor children had no natural de jure guardian. If so, the alternative that was open to the

Income Tax Officer was to move the court to have a guardian appointed for the minor legal representative before he could proceed with the

matter. As we have pointed out already, this is not a case where the Income Tax Officer was not aware of the existence of the minor legal

representatives. All that could be said even in the light of the contention that was put forward before the Tribunal was that the Income Tax Officer

was ignorant of the requirement of the Mohamedan law that in absence of a father, fathers father and a testamentary guardian appointed by them, a

guardian can be appointed only by the court. The fact that the Income Tax Officer bona fide thought that the mother could represent her minor

children as a guardian cannot in any way affect the legal position that she is not the de jure guardian of her minor children. Under these

circumstances, the contention of the assessee before the Tribunal, as accepted by the Tribunal, namely, that there was no proper service of the

notice on the minors represented by the de jure guardian according to the personal law applicable to them, was correct.

In this connection, the Tribunal itself has relied on a decision of this court by Srinivasan J. in Ravith Bibi Vs. Agricultural Income Tax Officer,

Dindigul, . That was a case of an assessment of a minor to agricultural Income Tax u/s 17(4) of the Agricultural Income Tax Act. In that case, a

guardian had been appointed under the Guardians and Words Act for the minor. However, the notice was not served on the said guardian, but

was served on some other person as representing the minor by affixture and there being no return, the assessment was made u/s 17(4) of the said

Act. The learned judge has held that the Agricultural Income Tax Officer acted without jurisdiction in so making the assessment u/s 17(4) without

service of notice on the de jure guardian of the minor assessee. The learned judge pointed out (page 473) :

It is axiomatic that when no notice can properly issue to a minor direct, it is his lawful guardian either under the personal law of the parties or such

guardian appointed by court who is liable to be assessed in respect of the income receivable by the minor. The claim of the department that in the

previous year a notice was issued to the maternal uncle of the minor, Mohammad Rowther, or that he paid the tax for that assessment year is

wholly irrelevant for the purpose of adjudicating upon the validity of the notice in the instant cases. When the law requires that a particular course

should be followed before the Income Tax Officer can derive the right to make a best judgment assessment u/s 17(4), the failure to adopt the

prescribed course necessarily invalidates the subsequent action."" It is this judgment of this court that was followed by the Tribunal in the present

case. Nothing was brought to our notice to hold that the principles laid down by this Court in the judgment referred to above cannot be applied to

the proceedings under the Income Tax Act.

The only decision to which our attention was drawn by the learned counsel for the department is that of the Supreme Court in First Additional

Income Tax Officer, Kozhikode Vs. Susheela Sadanandan and Another, . In that case the Supreme Court did not decide the question finally, but

remanded the matter to the High Court come to a definite conclusion on certain points which the Supreme Court itself formulated. All that the

Supreme Court could be said to have done in that case was to quote with approval an extract from an earlier judgment of that court in Daya Ram

and Others Vs. Shyam Sundari, , wherein it was held :

When this provision (Order XXII, rule 4 of the Code of Civil Procedure) speaks of legal representatives is it the intention of the legislature that

unless each and every one of the legal representatives of the deceased defendants, where these are several, is brought on record there is no proper

constitution of the suit or appeal, with the result that the suit or appeal would abate ? The almost universal consensus of opinion of all the High

Courts is that where a plaintiff or an appellant after diligent and bona fide enquiry ascertains who the legal representatives of a deceased defendant

or respondent are and brings them on record within the time limited by law, there is no abatement of the suit or appeal that the impleaded legal

representatives sufficiently represent the estate of the deceased and that a decision obtained with them on record will bind not merely those

impleaded but the entire estate including those not brought on record.

We are of the opinion that the above statement of law approved by the Supreme Court in that decision has no relevancy to the facts of this case.

This is not a case where the question involved is one, whether the estate of the deceased is properly and fully represented or not. On the other

hand, the question is as to whether the notices contemplated by the statute have been properly served or not. Therefore, the above decision is not

of any assistance to the department in the present case.

The question which has been referred to this court and which we have extracted already will show that the contention of the revenue is that the

Tribunal ought not to have set aside the entire assessment. As a matter of fact, that was also the argument addressed to us. The argument is that the

assessments may be bad so far as the minors are concerned, but they were valid so far as the major legal representatives are concerned on whom

notices were served. We are not able to conceive of the assessments being good in part and bad in part. The assessments in question were with

reference to the years when the deceased was alive. On the death of the deceased all his heirs simultaneously succeeded to the estate of the

deceased in definite shares according to Mohamedan law. Consequently, if after valid notices had been served on all the heirs, assessments had

been made and the tax had been determined, the tax would have to be paid by the heirs according to their shares in the estate of the deceased to

the extent to which they have inherited the estate of the deceased. Therefore, every one of the heirs is interested in the issue of the determination of

taxable income as well as the quantification of the tax liability. Hence the determination of the total income without proper notice to all the heirs

cannot be said to be good so far as the heirs on whom notices were served and bad so far as the heirs on whom notices were not properly served.

The assessment itself being one, single and indivisible, it is not possible to conceive of a situation where it can be said to be good in part and bad in

part. Consequently, once it was established and found by the Tribunal that the notices on the minor legal representatives were not legally and

properly served, the Tribunal was justified in setting aside the entire assessments.

Under these circumstances, we answer the question referred to this court in the affirmative and against the department. Since the assessee is not

represented, there will be no order as to costs.