Hindu widow's enlarged ownership in joint family property can make later relinquishment a taxable gift under gift-tax law.

A Hindu widow in possession of her undivided share in joint family property is treated as becoming full owner under section 14(1) of the Hindu Succession Act, 1956, even without partition, because possession and the right of alienation are sufficient to enlarge the limited estate. On that basis, relinquishment of the share after the Act came into force amounts to a transfer of property within the charging provision of the Gift-tax Act, 1958, and is therefore a taxable gift. The analysis links the widow's statutory enlargement of title to the gift-tax consequence of later surrender of the share.

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Issues: Whether relinquishment of the assessee's undivided half share in Hindu undivided family property, after the Hindu Succession Act came into force, amounted to a taxable gift under section 4(c) of the Gift-tax Act, 1958.

Analysis: On the death of the assessee's husband, his interest in the Hindu undivided family property devolved on her under section 3(2) of the Hindu Women's Right to Property Act, 1937, subject to the limited estate under section 3(3) of that Act. When the Hindu Succession Act, 1956 came into force, section 14(1) enlarged the estate of a female Hindu in property possessed by her into full ownership. The assessee's undivided share was treated as property in her possession despite the absence of partition, and the right of alienation supported that conclusion. Once she became full owner, relinquishment of that share amounted to transfer of property within the charging provision of the Gift-tax Act.

Conclusion: The relinquishment constituted a taxable gift and the assessment to gift tax was valid.

Ratio Decidendi: A Hindu widow who is in possession of her undivided share in joint family property becomes full owner by virtue of section 14(1) of the Hindu Succession Act, 1956, and relinquishment of that share thereafter is a taxable gift.

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