# GOLI ESWARIAH v. COMMISSIONER OJ[ GIFT TAX, ANDHRA PRADESH

- **Citation:** [1971] 1 S.C.R. 522
- **Court:** Supreme Court of India
- **Decided:** 1970-05-05
- **Case number:** Civil Appeal No. 695 of 1968
- **Bench:** J. C. Shah, K. S. Hegde
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/goli-eswariah-v-commissioner-oj-gift-tax-andhra-pradesh-5092
- **Pages:** 8

## Headnote

Gift Tax Act 18 of 1958, s. 2(xxiv) (d)-Transfer of property-Hindu
throwing separate property into joint family
stock-His
act
whe1ha
amounts to 'tmnsacrion' within the
meaning
of sub-cf. (d)-Whether
amounts to 'transfer of property'
liable to be
treated as 'gift'
under
ss. ~(xii) & 4(a) of the Act-Word 'disposition' ins. 2(xxiv), meaning of.
The appellant owned certain self-acquired properties which by a deed
Jated December 9, 1957 he threw into 'the common stock of his Hindu
Joint Family.
The Gift Tax Officer held that he had thereby made
a
gift t<rxable under the Gift Tax Act, 1958.
After proceedings before the
authorities ur.der the Act the question whe_ther the appellant had made
'transfer' of the property so as to attract the provisions of the Act was referred to the High Court of Andhra Pradesh. Following its earlier decision in Satymrarayanamurthy's case the High Court held that the act of
.the appellant r1mounted to a 'trans'fer' within the te'fms of s. 2(xxiv) (d) of
the Act and therefore was a gift such as envisaged in s. 2(xii) and s. 4(a)
of the Act.
In SCityanarayananwrthy 's case aforesaid, it had been held
that an act similar to that of the appellant would amount to "a 'transaction' entered into by any person with intent thereby to diminish directly
or indirectly the value of his own property and to inC'rease the value of
the property of any other person".
With certificate
appeal
against the
judgment of the High Court was filed in this Court.
HELD : The appeal must be al!owed since the declaration by which
the assessee had impw-essed the character of joint Hindu family property
en the self-acquired properties owned by him did not amot'11t lo a ·transfer'
so as to attract provisions of the Act. [529 Fl
A
B
G
D
E
A Hindu Joint Family is no,t a creature of contract. The doctrine of
throwing into common sto.:k inevitably postulates that the owner of the
separate property is a coparcener who has an interest
in the coparcenary
F
property and desires to blend his separate property with the coparcenary
prope-rty.
The separate property of a member of a joint Hindu Family
may he impressed with the character of Joint Family property if it is
voluntarily thrown by him into the common stock with the intention of
abandoning his separate claim therein.
The act by which the coparcener
throws his separ'atc property to the common stock is a· unilateral act. By
his individual volition he renounces hi~ individual right in that property
and treats it as a property of the family.
As soon as he declares his inG
tention to treat his self acquired property as that of the Joint Family, the
property assumes the charac:er of Joint Family Property. The doctrine of
throwing into common stock is a doctrine peculiar to the Mitakshara
School of Hindu Law.
When a coparcener throws his separate property
into commo'l stock. he makes no gift under Ch. VII of the Transfer of
H
Property Act.
In such a case there is no donor or donee.
Further no
question of accerytance of the property thrown
into the common stock
arises.
[5~6 A-F]
/
-
A
B
c
D
F
G
GOLI ESWARIAH v. COMMR. GIFT TAX ( Hegde. f.)
52 :l
Tt was not necessary in the present .::ase to comider whether the act of
the assessee could be said to have '·diminished directly or indirectly the
value of his own property and increased the value of the property" of his
joint family, because his act could
not he considered as a •·trans:tction
entered into"'. Clause (d) of s. 2(xxiv) contemplate;; a "transaction entered into" by one person with another. It cannot appl~ to a unilateral :~ct.
It m11st be an act to which two or more persons are parties.
Even though
under the Act the undivided ·family is a 'person' the assessee did not enter
into any transaction with his family.
Therefore, it was not possible to
<~!tree with the High Court that
the act of the assessee fell within
ih-·
scope of s. :!(xxiv) (d) of the Act. [52S A-Bl
The assessee's act could also not be considered as a 'disposition' unJer
the mai

## Text

522
GOLI ESWARIAH
v.
COMMISSIONER OJ[ GIFT TAX, ANDHRA PRADESH
May 5, 1970
[J. C. SHAH AND K. S. HEGDE, JJ.]
Gift Tax Act 18 of 1958, s. 2(xxiv) (d)-Transfer of property-Hindu
throwing separate property into joint family
stock-His
act
whe1ha
amounts to 'tmnsacrion' within the
meaning
of sub-cf. (d)-Whether
amounts to 'transfer of property'
liable to be
treated as 'gift'
under
ss. ~(xii) & 4(a) of the Act-Word 'disposition' ins. 2(xxiv), meaning of.
The appellant owned certain self-acquired properties which by a deed
Jated December 9, 1957 he threw into 'the common stock of his Hindu
Joint Family.
The Gift Tax Officer held that he had thereby made
a
gift t<rxable under the Gift Tax Act, 1958.
After proceedings before the
authorities ur.der the Act the question whe_ther the appellant had made
'transfer' of the property so as to attract the provisions of the Act was referred to the High Court of Andhra Pradesh. Following its earlier decision in Satymrarayanamurthy's case the High Court held that the act of
.the appellant r1mounted to a 'trans'fer' within the te'fms of s. 2(xxiv) (d) of
the Act and therefore was a gift such as envisaged in s. 2(xii) and s. 4(a)
of the Act.
In SCityanarayananwrthy 's case aforesaid, it had been held
that an act similar to that of the appellant would amount to "a 'transaction' entered into by any person with intent thereby to diminish directly
or indirectly the value of his own property and to inC'rease the value of
the property of any other person".
With certificate
appeal
against the
judgment of the High Court was filed in this Court.
HELD : The appeal must be al!owed since the declaration by which
the assessee had impw-essed the character of joint Hindu family property
en the self-acquired properties owned by him did not amot'11t lo a ·transfer'
so as to attract provisions of the Act. [529 Fl
A
B
G
D
E
A Hindu Joint Family is no,t a creature of contract. The doctrine of
throwing into common sto.:k inevitably postulates that the owner of the
separate property is a coparcener who has an interest
in the coparcenary
F
property and desires to blend his separate property with the coparcenary
prope-rty.
The separate property of a member of a joint Hindu Family
may he impressed with the character of Joint Family property if it is
voluntarily thrown by him into the common stock with the intention of
abandoning his separate claim therein.
The act by which the coparcener
throws his separ'atc property to the common stock is a· unilateral act. By
his individual volition he renounces hi~ individual right in that property
and treats it as a property of the family.
As soon as he declares his inG
tention to treat his self acquired property as that of the Joint Family, the
property assumes the charac:er of Joint Family Property. The doctrine of
throwing into common stock is a doctrine peculiar to the Mitakshara
School of Hindu Law.
When a coparcener throws his separate property
into commo'l stock. he makes no gift under Ch. VII of the Transfer of
H
Property Act.
In such a case there is no donor or donee.
Further no
question of accerytance of the property thrown
into the common stock
arises.
[5~6 A-F]
/
-
A
B
c
D
F
G
GOLI ESWARIAH v. COMMR. GIFT TAX ( Hegde. f.)
52 :l
Tt was not necessary in the present .::ase to comider whether the act of
the assessee could be said to have '·diminished directly or indirectly the
value of his own property and increased the value of the property" of his
joint family, because his act could
not he considered as a •·trans:tction
entered into"'. Clause (d) of s. 2(xxiv) contemplate;; a "transaction entered into" by one person with another. It cannot appl~ to a unilateral :~ct.
It m11st be an act to which two or more persons are parties.
Even though
under the Act the undivided ·family is a 'person' the assessee did not enter
into any transaction with his family.
Therefore, it was not possible to
<~!tree with the High Court that
the act of the assessee fell within
ih-·
scope of s. :!(xxiv) (d) of the Act. [52S A-Bl
The assessee's act could also not be considered as a 'disposition' unJer
the main part of s. 2(x:.>iv). The word 'disposition' is not a term of luw.
Further it has no precise meaning.
Its meaning has to be gathered from
the context in which it is used. In the context in which the term is u~ed
in s. 2(xxiv), it cannot mean to "dispose o"f".
Otherwise, even ifa man
abandons or destroys his property it would become a "gift" under the Act.
That could not have been the intention of the Legislature.
In s. 2(xxiv)
the word 'disposition' is used along with words ''conveyance, assignment,
settlement, delivery, payment or other alienation of property''. It is clear
from the context that the word 'disposition' therein refers to a bilateral or
multilateral act. It does not refer to a unilateral act. [528 D-FJ
Ma/lesappa Bandeppa Desai & Ors. v. Desai Mallappa & Ors. [19611
3 S.C.R. 779, Grimwade & Or.~. v. Federal Commissior1er of Taxation, 78
C'.L.R. 199, Commi.vsioner o/lncome-lax, Mc1dras v. M. K. Stremamz. 56
l.T.R. 62 ond M. K. Stremann v. Commi.uioner of Income-tax, 41 I.T.R.
297, applied.
Commissioner oJ Gift Tax, Madra.1' v. P. Ranj?aswami Naidu T.C. 272
of 1964 : R. S. R. M. Ramaswami Cl!ettiar v. The Com11zis.~ioner of Gift
1(~o~:, Madras. Tax Case No.lO of 1966, Dr. A. R. Shukla v. Co111missioner
of Gift Tax. Gujara~. 74 I.T.R. 167 and
Sllll'. Laxmibai Narayana Ra6
Nerlekar v. Commissioner of Gift-tax. 65, J.T.R. 19, approved.
Commissioner of Income-tax. Hyderahad v. C. Satyanarayanamurthy,
:~fi I.T.R. 353. G. V. Krishna Rao & Ors. v. First Add/. Gift Tax O!Jin'l".
Gwltur. 70 I.T.R. 812 and Commissioner of Gift Tax v, laRdish Saran, 75
I.T.R. 529, disapproved.
CIVIL APPELLATE JuRISDICTION: Civil Appeal No. 695 of
1968.
Appeal from the judgment and order dated October 13. 1966
of the Andhra Pradesh High Court in Case Referred No. 74 of
1963.
N. A. Palkhivala and T. A. Ramachandran, for the appellant.
B. Sen. G. C. Sharma. R.. N. Sachthev and B. D. Sh~1rma, for
H
the respondent.
~
M. C. Chaglo, M. Shankar and K. Jayaram, ior interveners
Nos. 1 and 2.
l
i j
."i
.I
l
. ;
I
' I :l
I.
.-I
I
524
SUPREME COURT REPORTS
(1971]1 S.C.R,
N. D. Karkhanis and T. A. Ramachandmn, for .intcr\'ener
No.3 .
·~he Judg1~1cnt of the Court was delivered by
Heode J.
This appeal by certificate arises from the J:~dom,
"' '
h H. h C
d
d · ·
0 cnt
·of the Andhra Prades
tg
ourt ren ere m Jts advisory juris.
diction on a case stated by the Income-t.ax Appellate Tribunal
Hyderabad Bench under s. 26 (!) o,f the Gtft-tax ~ct, 195g (to~
hereinafter referred to as the Act ) .
The question referred for
the opinion of the High Court was :
"Whether the declaration by which the assessee bas
impn:ssed the character of joint Hindu family properly
on the self-acquired properties owned by him amounts to
a transfer so as to attract the provisions of the Gift-tax
Act."
.The High Court following its-earlier decision in Commissiontr
.of Income-tax,
H.vderabacl v,
C.
Satymiarayanamurlhy(l); D
answered that question in the affirmative.
The material~facts as could be gathered from the statement of
the case submitte? to the High Court arc as follows :
The assessee is the karla of his joint family.
The ~ssessment
year with which we are concerned in this case is 1959-60, for which
the "previous year" is the year commencino on 23-10-1957 and
ending on 10-ll-1958. The assessee ownel movab!e and immOI'·
able propertie3 which were his self acquisitions.
By a deed dated
Dcc~mber 9, 1957, he threw into the common stock his houses
beanng Nos. 6658-59 and 273! situate at Tmambavidil Secuo·
der~bad an~ a cash deposit of Rs. 1,50,000 in the firm of M/~
Goh Eswanah, Paper Merchants, Secunderabad. In the IJO?k
of account of the finn, necessary entries were made transfern~g
~e amount to the account of the family.
The Gift-tax. om~~
e~~ed that portion of the value of the properties so bknded. ,
which .the assessee ceased to have a right on partition of the fJrnll)
as h.avlllg been gifted by him to the family.
He rejected the ~0~
tcrntlo.n. of _the assessee that his act of throwing his self .acqUld~r
fh op1rtles_ mto the common stock did not amount to a gJft un oot
111~ • ct. hln appeal, the Appellate Assistant ConunissionJr
1
~ ere
w· vtew 1 at smce the deed hi question was not registere· ' ~as
su~~ n~ trans.fer of the immovable propertie~ to the ·familY .30 but
~
with rc;~~ 1 was hno gift of the two houses mentioned ~ari~e~ ~ift
and
'. to 1 e sum of Rs I 50 000 he considered 11 a_~ ndcr
accordingly held that 3/ 4th. of 'it w;s liable to be taxed u
n' 56 un. R. 353.
A
R
c
D
E
F
G
H
..
GOLI ESWARIAH V. COMMR. Q!FT TAX (Hegde, J.)
525
the provisions of the Act.
Thereafter the matter was taken up il1
appeal to the tribunal.
The tribunal by its order dated November
17, 1961 held that the act by which the assessee threw his self
acquired properties to the family hotchpot did not amount to a.
transfer and hence it need not have been effected, by a. registered
document. It further held that where the coparcener threw his
self acquired properties into the hotchpot of the joint family, there
was no element of transfer within the meaning of s. 2, cl. (x.xiv)
sub-cl. (d) of the Act'.
At the instance of the Commissioner,
Gift-tax, Andhra Pradesh, the tribunal stated a case for the opinion :
o,f the High Court and s~bmitted the aforementioned question for '
its opinion.
The High Court did not examine the question of law
arising for decision afresh as it was bound by the earlier decisi0n
of that High Court in Commissioner of lncome•tax, Hyd!'rabad
v. C. Satyanarayanamurthy(l) wherein that court had held that
where a Hindu by a declaration has impressed on his self acquired
property the character of joint family property, the same would
amount to a transfer of property within the terms oi s. 2(xxiv) (d)
and as such is a gift as envisaged in s. 2(xii) and s. 4(a) of the
Act. The view taken in that case was that an act similar to the
one we are called upon to consider in this case would amolmt to
a " 'transaction' entered into by any person with intent thereby to
diminish directly or indirectly the value of his own property and
to increase the value of the property of any other person."
On the question of law that we are required to decide in this
case. there is a sharp cleavage of judicial opinion.
The Antlhra
Pradesh High Court in the case referred to earlier as well as in
G. V. Krishna Rao and Ors. v. First Addit·ional Gift-tax Officer,
Guntur(l)
and the Allahabad High Court in Commissioner of
Gift-tax v. Jagdish Saran(a) have taken the view that when a coparcener in a Hindu Undivided Family governed by Mitakshara
School throws his self acquired properties into common stock. the
same amounts to a 'gift' under the Act.
On the. other hand. a full
bench of the Madras High Court in Commissioner of Gift-tax,
Madras v. P. Rangasami Naidu( 4 )
~nd VR. S. RM. Ramaswami
Chettiar v. The Commissioner of Gift-tax, Madrasr•). a full tench
of the Gujarat High Court in Dr. A. R. Shukla v. Commisstoner
of Gift-tax, Gujarat(6 ); a division bench of the Kerala High Court
in P. K. Subramania lyer v. Commissioner of Gift-tax, Kerala('l)
and a division bench of the Mysore High Court in Smt. Laxmibai
Narayana Rao Nerlekar v. Commissioner of Gift-tax(8), have
taken a contrary view.
(t) 56 I.T.R. 353.
(3) 75 I.T.R. 529.
(5) Tax Case No. 10 of 1966.
(7) 67 J.T. R. 61:!.
(2) 70 I.T.R. 812.
(4) Tax Case 272 of 1964 ..
(6) 74 I.T.R. 167.
(8) 65 I.T.R. 19.
...
SUPREME COURT REPORTS
[1971] 1 S.C.R.
To pronounce on the question of law presented for our decJsJOn,
we must first examine what is the true scope of the doctrine of
throwing into the 'common stock' or 'common hotchpot'.
It must
. be remembered that a Hindu tamily is not a creature of :1 contr_act.
As observed by th!s Coun in Maliesappa Bandeppa Desai and Ors.
v. De sa,· Mallappa and On·. C) that the doctrine of throwing inlu
common stock inevitably postulates that the owner of a separate
property is a coparcener who has an interest in the copan.:enary
property and desires to blend his separate propeny with the coparcenary prope;·ty.
The existence of a coparcenary is absolutely
necessary be,fc;e a coparcener can throw into the common stock
his self acquired properties.
The separate property of a member
of a joint Hindu family may be impressed with the character of
joint family property if it is voluntarily thrown 'by him illto lhe
common sto:k with the intenti0n of abandoning his separate claim
therein.
The separate property of a Hindu ceases to be a ~ep.u•He
.property and acquires the characteristic of a joint '.:amily or ancestral property not by any physical mixing with his joint family or
his ancestral property but by his own volition and intention by his
waiving and surrendering his separate rights in it as separate property.
The act by which the coparcener throws his
sr::par<ate
property to ~he common stock is a unilateral act.
There is no
question of either the family rejecting or accepting it.
By his
individual volition he renounces his individual right in that property
and treats it as a property of the family.
As so~11 as he declares
his intention to treat his self acquired property as that of the joint
family, the property assumes the character of ;oint family
property.
The doctrine of throwing into the common stock is a
doctrine peculiar to the Mitakshara School of .. Jiindu Jaw.
When
·a coparcener throws his separate property into tht: common stock.
he makes no gift under Chapter VII of the Transfer of Property
Act.
In such a case there is no donor or donee.
Further no
question of <Jccept~"'Ce of t11e property thrown into the common
·stock arises.
Bearing in mind the true nature of the doctrine of throwing
into the common hotchpot, we shall now proceed to examine
A
~~
('
I)
E
F
the relevant provisions of the Act to ·a~ertain whether the act of
G
the assessee can be comidered as a gift under the Act.
Section 3 is the charging section.
It provides that subiect to
the other provisions contained in the Act, there shaH be charged
·for every assessment year commencin~ on and from the 1st dar of
April, 1958, a tax known as gift tax in respect of the gifts, if anv.
11
~made by a persQn during the previous year (other than gifts made
.
--
(l) [i961] 3 S.C.R. 770.
n
GOLI ESWARIAH V. COMMR. GIFT TAX (Hegde, J.)
527
before the )_st day of April 1957) at the rate or rates specified in
the Schedule.
Gift js defined in s. 2(xii) as follows:
" "gift'' means the transfer by one person to another
of any existing movable or immovable property made
voluntarily and without consideration in money or
money's worth, and includes the transfer of any property
deemed to be a gift under section 4"'.
In this case we are not dealing with a deemed gitt.
Therefore
we need not consider the scoP'.! of s. 4.
Before an acl can be
considen:d as a gift as defined, there must be a transfer of property
by one person to another.
'Person' is defined as including a Hindu
Undivided Family in s. 2(xviii). Section 2(xxiii)
says th:lt
'property' includes any interest in property, moveable and immovable.
Section 22(xxiv) defines "transfer of property" thus :
"Transfer of property'' mear.s any disposition, conveyance, assignment, settlement, dehvery, payment or
other alineation of propertx and, without limiting the
generality of the foregoin~ mcludes.-
( a) the creation of a 'trust in property;
(b) the grant or crea~ion of any lease, mortgage,
~harge, ~asement, licence, power, partnership or
mterest m propert)'.;
.
'E
(c) the exercise of ·a p~wer of appointment of proG
H
perty vested in any person, not the owner of the
property, to determine its disposition in tfavour
of any person other than the donee of the power;
and
(d) ~ny transaction entered into by any person with
mtel).t thereby to diminish directly or indirectly
the value of his own property and to increase
the value of the property of any other person."
The High Court relied on s. 2(xxiv) (d) in answering the
question referred to it in favour of th~ Reven~e.
~t came to. the
conclusion that the act of the assessee m throwmg his self-acquired
properties into the col!lm?n stock amounted. t<? . "a t.ransaction
entered into by him w1th mtent thereby to dimi~tsh dtreC::tly or
indirectly the value of his own pro~~rty a~d to mcrease the value
of .the property of any other person . ·It Js true that the assessee
by throwing his sel!-acquired property irtto the.cm_nmon stock gave
up his exclusive rtght in that property and m tts place he w~s
content to own that property jointly with the oth~r members of. his
family.
We do not think that it is necessary in thts case to constder
whe~her the act of the assessee can be said to have "diminished
5 28
.
SUPREME COURT REPORTS
(1971] 1 S.C.R.
dir:ctly or indireCtly the value of his own property ~nd iritrea~cd:
A •
the value of the property" of his join~ -family bec'ause in our opinion
that act cannot be considered as. a "transaction entered into ...
Clause.( d) ct s. 2 (xxiv) contemplates a "transaction entered into''
,
by one person with another. It cannot apply to a unilateral acr.
' It must be an act to which two or more. persons ar~ parties.. It is
true that for the purpose of the Act, a Hindu Uvdivided Family
B
can be considered as a "person":
But the assessee did not enter
into any transaction witlf his family.
;Therefore we are unable to
agr~e with the High Coyrt that the ·~~t of the assessee fell within
the scope of s. 2 (xxiv.) (d) of the Act.
c
St>crinn ~ ~ ':>:J\'(d) i~ ::;imilar tQ_ Pur~graph (f) of s. 4 cf the
Australian Gift Duty Assessment A:ct,.~1941-~2. Interpreting
C
that section in Grimwade and Ors. v. Federal Commissioner of
Taxation ( 1), the High Court of Australia observed that the tr~n.
sactlon by a person referred to therein must be a t~ansactio!)....wrtti.
some other person and that "it cannot be a unilateral act.
Mr. B. Sen, learned Counsel for the department contended
that the said act should be considered as a 'disposition' under *e
main part of s. '2(xxiv).
The word 'disposition' js not a tenn of
law.
Futrher it lias no precise meaning.
Its meaning has to be
gatherea from the context in which it is used.
In the context in
which that term is used in s. 2 (xxiv), it cannot mean to 'dispose
ct.
Otherwise even if a man abandons or destroys his property,
it would become a 'gift' under the Act .. That could not have been
the intention of the legislature. In s. 2(xxiv), the word 'disposition' is used along with-words "conveyance, assigiunent, settlement.
delivery, payment or other alienation of property." Hence it is
clear from the context that the word 'disposition' therein refers to
a bilateral or a multi-lateral, act.
It does not refer to a unilateral
act.
In this connection reference may be usefuUy made to the
decision of this Court in Commissioner of {ncome-tax, Madras v.
M. K. Stremann(2).
Therein the assessee first threw his private
properties into the conunon stock and afterwards there was a
partition amongst the m~mbers.of the family which included his two
minor sons and a minor daughter, represented by their mother.
The question arose whether the partitio,n in qu~stion amounted to
a transfer of a~sets by the assessee tp tile three minor children -so
as to attract the provisions of s. 16 ( 3) ( cr)(jv) of the Indian
Income-tax Act, 1922. In that case~ the Revenue did not contend.
in. this Court that the act of the assessee throwhlg into common
stock his self acquired properties amounted to transfer of assetslJ
by the ass.essee to his three minor childreq.
On the other hand,
it con~em~ed that. the.. partition, that took
p1~su9s<;<~ue~tly
amounted to a transfer of assets of the assessee t~"1iis muior child-
(1) 71J C.L.R, 199.
(2) s6 r.T.R. 6er _
D
E.
G
H
B
c
D
cGOLI ES:WARIAH V. COMMR. GIFT TAX (Hegde, J.)
5 29
ren.
This Court overruled that contention.
Therein the conten~
tion of the Revenue appeared to have proceeded on the basis that
the antecedent act of the assessee viz. throwing his self~acquired
properties to the common stock may not amount to a transfer of
his assets to his minor children but the partition that followed
amounted to such a transfer. In that very case the Revenue appears
to have contended before the High Court that the act of the
assessee in throwing his self acquired properties into common stock
amounted to a transfer of his assets to his minor children.
The
High Court observed that when the separate property of a coparcener ceases to be his separate and becornes impressed with the
character of coparcenary property, there is no trnnsfi!r of that
property from the coparcener to the coparcenary; it becomes joint
family property because the coparcener who ov.ned it uptil then
as his separate property, has by the exercise of his volition, impressed it with the character of joint family or coparcenary property,
to be held by him thereafter alongwith other members o: the joint
family; it is by his unilateral action that the property became joint
family property; the transaction by which a property ceased to be
the property of a coparcener and became impressed with
the
character of coparcenary property, does not itself amount to a
transfer; no transfer need precede the change and no transfer
ensues either-see M. K. Stremann v. Commissioner of Income~
tax, Madras(l). We are in agreement with those findings.
For the reasons mentioned above,
we allow this appeal, set
aside the judgment of the High Court and answer tl)e question
referred to the High Court thus :-
The declaration by which the assessee has impressed the character of joint Hindu family property on the self~acquired proper~
ties owned by him did not amount to a transfer so as to attract the
provisions of the Act.
The Revenue shall pay the costs of the
appe11ant in this appeal.
G.. C.
(1 ) 41 I. T. R. 291
L 13 Sup. Cl/10-5
Appeal allowed.