TaxTMI 
TaxTMI 
1978 (2) TMI 56
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....of Late Omprakash Bajaj [1977] 110 ITR 263 (AP). Having regard to the view expressed therein, this question is answered in the affirmative and against the accountable person. Similarly, question No. 3 referred at the instance of the revenue is covered by the judgment of this court in E.D.C. No. 7 of 1975 dated October 13, 1977 [CED v. Durga Prasad Beharilal-since reported in [1979] 116 ITR 692 (AP)]. In view of the opinion expressed by this court, this question is answered in favour of the accountable person. The Only question that survives for our decision is question No. 1 and it reads : " Whether an adopted son can be regarded as a lineal descendant within the meaning of section 34(1)(c) of the E.D. Act, 1953 ? " The facts necessary for answering that question are these : One Nuli Lakshminarayana (deceased) and his adopted son, N.V. Somaraju (accountable person) constituted a HUF governed by the Mitakshara law. Lakshminarayana died on March 6, 1966. The adopted son, Somaraju, being the accountable person, rendered an account of the deceased's estate before the Asst. CED showing the principal value of the estate at Rs. 11,07,936. It was claimed before the Asst. CED that ....
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....son cannot succeed to an impartible estate when there is a natural born son. In so holding they said that the natural born son would be entitled to the honour of primogeniture and precedence, the adopted son being considered as a younger brother. The Full Bench of the same court in Martand Jiwaji v. Narayan Krishna, AIR 1939 Bom 305 [FB], again went into the question of the consequences of adoption. The learned judges quoted from Dattaka Mimamsa, Nanda Pandita and Manu Smriti and observed : "The modern trend of decisions is to take a more liberal view and to interpret the texts from a practical point of view as far as possible. This is particularly noticeable in the decisions of this court on several questions of adoption, such as the adoption of an only son, the adoption of a married boy, the adoption of a boy whose mother the adopting father could not have legally married, and the adoption by a widow without the express consent of her husband. We do not see why a similar liberal view should not be taken in this case, having regard to the interests of the boy to be given in adoption. With his father actually living, it would be a hardship on the boy to treat him as an orphan, m....
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....ain fictions and relied upon the fiction introduced in s. 2(15A) of the I.T. Act, s. 4, Explanation (aa) of the-W.T. Act, and s. 27(7)(ii) of the E.D. Act. He cited in support of his contention, that legal fiction introduced in one Act for one purpose cannot be extended to another statute for another purpose, the following decisions: State of Bombay v. Pandurang Vinayak Chaphalkar [1953] SCR 773 (SC), Bengal Immunity Co. Ltd. v. State of Bihar [1955] 6 STC 446 (SC), Radhakissen v. Durga Prosad, AIR 1940 PC 167, M. K. Balakrishna Menon v. Asst. CED [1972] 83 ITR 162 (SC) and CIT v. Shakuntala [1961] 43 ITR 352 (SC). In all these cases, it has been held that the legal fiction must be limited to the purpose indicated by the context in that statute and the fiction must not be made to travel beyond the terms of that statute. We would like to make it clear that it is not the case of the revenue that any legal fiction is introduced in the Act regarding "adopted child". Naturally, therefore, we will have to fall back upon the personal law. In Bouvier's Law Dictionary, volume II, third revision, at page 2023, the expression "lineal" is defined thus: " Lineal. In a direct line. Lineal ....
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.... is in the same position as an aurasa son except in a few matters where the aurasa son is placed in a more favourable position and he can inherit both lineally and collaterally in his adoptive family." The same view has been expressed by Mayne on Hindu Law and Usage, 11th Edn., page 243, para. 188, with the marginal note "Lineal succession": " An adopted son is entitled to inherit not only to his adoptive father, but to his father and grandfather and other more distant lineal ancestors just as if he were natural-born son. So also he is entitled to inherit to the adoptive father's collaterals, whether the latter are related to the former through males only, or through females." Mulla on Hindu Law, 14th Edn., page 556, in para. 494, has detailed the consequences that flow on adoption: " Adoption has the effect of transferring the adopted boy from his natural family into the adoptive family. It confers upon the adopted the same rights and privileges in the family of the adopter as the legitimate son, except in a few cases. Those cases relate to marriage and adoption and to the share on a partition between an adopted and an after-born son." The mere fact that adoption does ....