Legal Case Summary

Case Details
Case ID 1fec09b7-3d12-4701-a84a-7f38f59a8d50
Body View case body.
Case Number CIVIL APPEAL Nos. 124 TO 129 OF 1964
Decision Date Dec 08, 1964
Hearing Date
Decision The Supreme Court upheld the validity of Section 3 of the Wealth Tax Act, 1957, affirming that it applies to Hindu Undivided Families (HUFs) as well as individuals and companies. The court reasoned that the term 'individuals' in Entry 86 of List I should be interpreted broadly to include groups of individuals, such as HUFs, which are recognized legal entities. The court dismissed the appeals, confirming that the imposition of wealth tax on HUFs is within the legislative competence of Parliament. Consequently, the provision was deemed valid and the appeals were dismissed with costs.
Summary The Supreme Court of India, in a landmark decision regarding the Wealth Tax Act of 1957, ruled on the applicability of wealth tax to Hindu Undivided Families (HUFs). The case arose from several appeals challenging the validity of Section 3 of the Act, which imposed a tax on net wealth. The appellants contended that HUFs should not be classified under the term 'individuals' as defined in Entry 86 of List I of the Constitution. However, the court held that the term should be interpreted broadly, confirming that HUFs fall within the scope of individuals. This case is significant in understanding the legislative framework surrounding wealth tax in India, particularly concerning HUFs. The ruling reinforces the tax obligations of HUFs, emphasizing their recognition as legal entities under Indian tax law. This decision has implications for tax compliance and planning for families operating as HUFs, impacting their financial strategies and obligations. Keywords: Wealth Tax Act, Hindu Undivided Families, Supreme Court of India, tax compliance, legal entities, legislative framework.
Court Supreme Court of India
Entities Involved Hindu Undivided Families
Judges P.B. Gajendragadkar C.J., M. Hidayatullah, J.C. Shah, S.M. Sikri, R.S. Bachawat
Lawyers N.C. Chatterjee, J.P. Agarwala, A.V. Viswanatha Sastri, J.P. Goyal, S.V. Gupte, R. Ganapathy Iyer, R.H. Dhebar, B.R.G.K. Achar
Petitioners Banarsi Dass
Respondents Wealth Tax Officer
Citations 1965 SLD 354, (1965) 56 ITR 224, (1968) 17 TAX 30
Other Citations Mahavirprasad Badridas v. M.S. Yagnik, Second Wealth-tax Officer, C-II Ward, Bombay [1959] 37 I.T.R. 191 (Bom.), N.V. Subramanian v. Wealth-tax Officer, Eluru [1960] 40 I.T.R. 567 (A.P), P. Ramabhadra Raju v. Union of India [1962] 45 I.T.R. 118 (A.P), Sarjerao Appasaheb Shitole v. Wealth-tax Officer, A-Ward, Belgaum [1964] 52 I.T.R. 372 (Mys.)
Laws Involved Wealth Tax Act, 1957
Sections 3