TaxTMI 
TaxTMI 
1969 (8) TMI 4
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.... 1, 1937. He left behind his widow, Aisha Bibi, and three sons who are the appellants before this court. The wakf created was of the nature of wakf-alal-aulad for the benefit of the settlor's wife, children and their descendants. The extent of the benefit conferred on them would appear from clause 5 of the deed of wakf as modified : " 5. After payment of all necessary outgoings such as establishment charges, collections charges, revenue taxes, costs of repairs, law charges and other expenses for the upkeep and management of the said wakf property, the mutawalli or mutawallis shall apply the net income of the said wakf property as follows, viz. : (a) in payment to me during the term of my life of one-fifth of the said net income by monthly instalments ; (b) in payment to each of my sons during the respective terms of their lives one-sixth of the said net income by monthly instalments ; (c) in payment to my wife, Aisha Bibi, during the term of her life one-tenth of the said net income by monthly instalments. The moneys payable as aforesaid to such of my sons as are minors shall until they attain the age of majority be respectively invested (after defraying the expenses of t....
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....n section 5 which alone entitled an assessee to claim exemption in respect of certain assets. The Tribunal did not find it possible to hold on the facts of the case that the amounts in dispute were receivable by the beneficiaries as maintenance under the terms of the wakf. As regards the quantum of valuation a direction was made that the value of the assessee's life interest may be capitalised on the basis of the valuation table set out in Park's Principles and practice of Valuations taking the rent security at 6 per cent. On applications for referring the question of law, the following common question was referred to the High Court under section 27 of the Act: " "Whether on the facts and circumstances stated, the right of the assessee to receive a specified share of the net income from the wakf estate is an asset the capitalised value of which is assessable to wealth-tax ? " The High Court negatived the contentions of the appellants that the right to receive a definite share of the net income from wakf property did not fall within the meaning of the word " assets " as defined by section 2(e) of the Act or that it was a mere right to an annuity which under the Mohammedan law ....
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.... A.K. Sen for the appellants is that the right to receive a share of the income under a deed creating wakf-alal-aulad can, by no stretch of reasoning, be regarded to fall within the meaning of the word to property " even in its wide and extended sense. He has referred to the incidents of such a right with particular reference to the Mohammedan law relating to wakf. That law owes its origin to a rule laid down by the Prophet of Islam ; and means " the tying up of property in the ownership of God the Almighty and the devotion of the profits for the benefit of human beings. " Once it is declared that a particular property is wakf, the right of the wakf is extinguished and the ownership is transferred to the mutawalli (vide Vidya Varuthi Thirtha v. Balusami Ayyar ). Wakfs could be divided into two classes: (i) public and (ii) private. A private wakf is one for the benefit of the settlor's family and his descendants. It is called wakf-alal-aulad. Before the enactment of the Mussalman Wakf Validating Act, 1913, a wakf, exclusively for the benefit of the settlor's family, children and descendants in perpetuity, was invalid. It was, however, valid if the property was given in substance to ....
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....ility to an attachment would not be attracted. The crux of the matter, according to Mr. Sen, is that the aliquot share of income under the deeds executed in the present case was reserved for the maintenance and support of the wakf and other beneficiaries during, their lifetime. It is pointed out that if the provisions contained in clause (5) of the deed of wakf were not to be read in that manner, the deed would be rendered void, a result which has to be avoided by the courts. It is thus contended that the right, in question, is a right to future maintenance measured by the aliquot part of the income and it is neither partible nor alienable, and is one which is wholly personal to the beneficiary. It lacks the basic attributes of property. Now " property " is a term of the widest import and, subject to any limitation which the context may require, it signifies every possible interest which a person can clearly hold or enjoy. The meaning of the word " property " has come up for examination before this court in a number of cases. Reference my be made to one of them in which the question arose whether mahantship or shebaitship which combines elements of office and property would fall ....
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....even on the assumption that it was so intended or to preserve the validity of the deeds it should be so construed, the right to the share of the income would certainly be an asset within the meaning of section 2(e) and would be liable to be included in the net wealth of the assessee. Mr. Sen has laid emphasis on the language of section 7(1) of the Act and has contended that the right to a share in the income is not capable of any valuation and the price which, it would fetch, if sold in the open market, could not possibly be ascertained. Such an argument was fully examined in the Bombay case in which the High Court referred to the provisions of the English statutes, which were in pari materia, as also decisions given by the English courts including the one by the House of Lords in Commissioners of Inland Revenue v. Crossman. It has been rightly observed by the High Court that when the statute uses the words " if sold in the open market " it does not contemplate actual sale or the actual state of the market, but only enjoins that it should be assumed that there is an open market and the property can be sold in such a market and, on that basis, the value has to be found out. It is ....