Inherited property retains ancestral character in the son's hands when a father dies intestate after the Hindu Succession Act.

Property inherited from a father who died intestate after the commencement of the Hindu Succession Act was held to retain the character of ancestral property in the son's hands. The reference, arising under the Income-tax Act, concerned the nature of self-acquired property devolving by succession on the son. Applying settled principle, the HC concluded that such inherited property does not lose its ancestral character on transmission from father to son. The question was answered in favour of the assessee and against the Revenue.

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Issues: Whether the self-acquired property of a father dying intestate after the commencement of the Hindu Succession Act is treated as ancestral property in the hands of the son.

Analysis: The reference arose from the Revenue under section 256(1) of the Income-tax Act, 1961, for determination of the character of property inherited by the assessee from his father. The property had been acquired by the father and devolved on the son on the father's intestate death. The Court held that, on settled principle, such property continues to be treated as ancestral property in the hands of the son.

Conclusion: The question was answered in the affirmative against the Revenue and in favour of the assessee.

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