Taxation classification under Article 14 upheld where different family units were treated on a rational, substantial basis.

Taxation classifications enjoy wider constitutional latitude, and absolute uniformity is not required if the Legislature selects the taxable unit on a rational and substantial basis. A Hindu undivided family governed by Marumakkattayam law and a Mappilla family governed by the corresponding law were not shown to be similarly situated in all material respects, especially given differences in family property, succession and partition. Historical treatment of Hindu undivided families as a separate taxable unit also supported the distinction. The classification was therefore valid and the challenge under Article 14 failed, leaving the Expenditure-tax Act, 1957 applicable to Hindu undivided families.

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Issues: (i) Whether the charging provision of the Expenditure-tax Act, 1957, treating a Hindu undivided family as a taxable unit but not extending the same treatment to a Mappilla undivided family governed by Marumakkattayam law, offended Article 14 of the Constitution of India.

Analysis: The constitutional test in taxation permits a wider latitude in classification. Absolute uniformity is not required, and the Legislature may select the taxable unit and apply different rates if the distinction is based on a rational and substantial basis. A Hindu undivided family governed by Marumakkattayam law and a Mappilla family governed by the corresponding law were not shown to be similarly situated in all material respects, particularly in view of the differing legal incidents affecting family property, succession, and partition. The historical treatment of Hindu undivided families as a separate taxable unit in fiscal legislation further supported the classification.

Conclusion: The classification was valid and did not violate Article 14.

Final Conclusion: The Expenditure-tax Act, 1957, was upheld as applicable to Hindu undivided families, and the challenge based on discrimination failed.

Ratio Decidendi: In taxation, a statutory classification is valid if it rests on a reasonable and substantial distinction and does not create obvious inequality among similarly situated persons.

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