Dependent spouse and minor child test under Expenditure-tax Act limits inclusion to actual support and maintenance dependence.

For an individual assessee, expenditure incurred by a spouse or minor child is includible under section 4(ii) of the Expenditure-tax Act, 1957 only if that person is in fact dependent on the assessee for support and maintenance. The Madras High Court construed the amended definition of "dependant" in section 2(g)(i) according to its natural meaning and the Act as a whole, and held that "spouse or minor child" does not extend to an independent spouse or child. It also read section 4(ii) as drawing a distinction between an individual and a Hindu undivided family, so the additional transfer condition does not govern an individual's case. The inclusion was therefore not justified.

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Issues: Whether the expenditure incurred by the assessee's wife and minor son could be included in the assessee's taxable expenditure under section 4(ii) of the Expenditure-tax Act, 1957, read with the definition of "dependant" in section 2(g)(i).

Analysis: The definition of "dependant" in section 2(g)(i), as amended, was construed according to its natural meaning and in the setting of the Act as a whole. The expression "spouse or minor child" was held not to extend to a spouse or minor child who was in fact independent and not dependent on the assessee for support and maintenance. The structure of section 4(ii) was also read as distinguishing the case of an individual from that of a Hindu undivided family, so that the additional condition relating to property or income transferred to the dependant did not govern the case of an individual. The Court declined to adopt the broader construction urged for the revenue and disagreed with the contrary view taken by the Andhra Pradesh High Court.

Conclusion: The inclusion of the wife's and minor son's expenditure was not justified under section 4(ii); the reference was answered against the revenue.

Ratio Decidendi: For an individual assessee, only a spouse or minor child who is in fact dependent for support and maintenance falls within section 2(g)(i), and the inclusion under section 4(ii) must be confined accordingly.

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