Law:

Section:

Section 2(15) of the Estate Duty Act, 1953 - Property - Deceased-karta of HUF possessed ancestral properties - He mortgaged said properties and obtained loan to meet family expenses and for contract business - Deceased also did business in stone quarrying and treated income therefrom as income of HUF - Said income was declared before Income-tax authorities in status of HUF during his life time and thereafter his sons declared it to be so in their respective returns - Deceased bequathed certain property in favour of his sons treating it to be his self acquired properties - Whether once deceased had treated income and property, whether he acquired it from self-exertions or from out of the ancestral nucleus as joint family property and impressed it with character of joint family property, he was precluded thereafter from treating it as separate property or disposing it of by a will - Held, yes - Whether fact that deceased disposed it of by will did not by itself make what was joint family property a separate property - Held, yes - Whether, consequently, assessment of estate of deceased as that of an individual was not proper and legal - Held, yes FACTS The deceased was karta of HUF and had possessed the ancestral properties. The properties were mortgaged and loan was obtained to meet family expenses and for contract business. The deceased was also engaged in the business of stone quarrying and income therefrom was treated as income of HUF from the year 1944-45 onwards. The income was also declared with the income-tax authorities in the status of HUF during lifetime of the deceased and thereafter the sons declared it to be so in respective returns. The deceased bequeathed the properties in favour of the sons. The Assistant Controller of the Estate Duty treated the properties as the self acquired properties of the deceased. On appeal, the Board of Revenue confirmed the order of the Assistant Controller. On reference: HELD It is one of the presumptions of Hindu law that where it is established or admitted that the family possessed some joint family property which from its nature and relative value may have formed the nucleus from which the property in question may…

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