Taxability of Court of Wards allowance turns on recipient's control, while Hindu undivided family exemption was unavailable.

A recurring allowance received through the Court of Wards was treated as taxable income once it came into the recipient's absolute control, even though it was originally paid for expenses. The exemption for receipts by a member of a Hindu undivided family was held inapplicable because the recipient was not a coparcener and had no legally recognisable Hindu-law right to partition or maintenance in that capacity. The analysis distinguishes income received by the Court of Wards for a ward from a later receipt by another person, noting that taxability can arise again when the amount passes into that person's hands. The referred question was answered in favour of assessability.

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Issues: Whether the maintenance allowance received by a prospective heir from the Court of Wards constituted taxable income in his hands, and whether it was exempt under the provision relating to receipts by a member of a Hindu undivided family.

Analysis: The allowance was paid under the Court of Wards Act as a recurring sum for the recipient's expenses, but once received it was under his absolute control and no longer retained the character of a ward's expense. The Court held that income received by the Court of Wards for the ward may be taxed in its hands, yet a further receipt by another person may still amount to income in that person's hands when it passes into his control. The recipient was neither a coparcener nor a person entitled as of right to partition or maintenance under Hindu law, and the expression used in the Court of Wards Act concerning dependants was not equivalent to membership of a Hindu undivided family for the purpose of exemption.

Conclusion: The allowance was assessable as income in the hands of the recipient and no exemption under the Hindu undivided family provision was available; the answer to the referred question was in the affirmative.

Final Conclusion: The reference was answered against the assessee and the assessed sum remained taxable in his hands.

Ratio Decidendi: A recurring allowance received from the Court of Wards becomes taxable income in the hands of the recipient when it is received as an amount under his control, and exemption for receipts by a member of a Hindu undivided family is confined to persons who receive the sum in that capacity and have a legally recognisable family right such as partition or maintenance.

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