P L D 1962 (W (PLP)

S. A. MAHMOOD, J.-By this reference under section 66 (1) of the Income-tax Act, the following question has been referred to us for our opinion :- "Whether, in the facts and circumstances of the case, the share income of the assessee's minor children arising from a partnership, to the benefits of which they were admitted, were liable under the provisions contained in section 16 (3) (a) (ii) of the Act, to be included in the total income of their mother who was also a partner in that firm." The above question has been referred concerning two assessment years, namely, 1952-53 and 1953-54, the facts being common. There is a firm Messrs Crown Bus Service in which Mst. Fatima Bibi, assessee, is a partner. Her minor children have been admitted to the benefits of the partnership. In view of the provisions contained in section 16 (3) (a) (il) of the Act the Income-tax Authorities included in the income of Mst. Fatima Bibi, the mother, the share income of her minor children from the partnership. The assessee contended that the word "individual" occurring in section 16 (3) of the Income-tax Act meant and signified only a male individual and not a female individual, such as the mother. This contention was overruled by the Income-tax Authorities and also by the Tribunal. The Tribunal relied on the Dacca High Court in the case of Akbari Begum v. Commissioner of Income-tax East Bengal (1959 Tax. Vol. 1, at p. 313) and disagreed with the decision of the Supreme Court of India in Commissioner of Income-tax, Madhaya Pradesh and Bhopal v. Sodra Devi, Damyanti Sahni v. Commissioner of Income-tax ((1957) 32 I T R 615) and Ramiza Bi Saheba v. Income-tax Officer, Circle Iv, Madras ((1959) 37 I T R 207). The Tribunal followed the decision of the Dacca High Court on the ground that they were bound to follow the decision of their own High Court. The assessee then moved the Tribunal under section 66 (1) of the Income-tax Act, which led to this reference. 2. The short question for determination in this case is whether the word "individual" in section 16 (3) means a male person as contended by the learned counsel for the assessee, or whether it includes a female also as claimed by the learned counsel for the Department and held by the Tribunal. This section provides as follows: - "16 (3) In computing the total income of any individual for the purpose of assessment, there shall be included- (a) so much of the income of a wife or minor child of such individual as arises directly or indirectly- (i) from the membership of the wife in a firm of which her husband is a partner ; (ii) from the admission of the minor to the benefits of partnership in a firm of which such individual is a partner ; (iii) from assets transferred directly or indirectly to the wife by the husband otherwise than for adequate consideration or In connection with an agreement to live apart ; or (iv) from assets transferred directly or indirectly to the minor child, not being a married daughter, by such individual (other wise than for adequate consideration ; and (b) so much of the income of any (person or association of persons) . . . . as arises from assets transferred (otherwise than for adequate consideration to the person or association), by such individual (for the benefit of his wife or a minor child or both) The word "individual" has not been defined in the Act but has been used in section 3. As there it includes not only a male but a female, it has been strenuously urged by the learned counsel for the Department that it has been used in the same sense In section 16 (3). This is also the main reason for interpreting it in that sense in Akbari Begum v. Commissioner of Income-tax, East Bengal, Dacca; Chanda Devi v. Commissioner of Income -tax (A I R 1951 All. 586); Commissioner of Income-tax v. Damayanti Sahni (A I R 1953 Pb. 199) and Jagaram Malik v. State of Madhya Pradesh (A I R 1955 Nag. 160). 3. It is not necessary to construe the same word in the same sense throughout an Act and any presumption that may exist in favour of such a construction is very slight. The same words may often receive different interpretation in different parts of they same Act, for they may convey one intention in one part of the Act and a different intention in another (context. Edinburgh Street Tramways Co. v. Torbain ((1877) 3 A C 58, 68) per Lord Blackburn.) The classic example of the same word having a somewhat different meaning in the same section is provided by section 57 of Offences against the Person Act, 1861, which deals with bigamy and enacts ; "Whosoever, being married, shall marry any other person during the life of the former husband or wife . . . . shall be guilty of felony." It is obvious that the word "marry" is used in two different senses in the same section. The same is the case in relation to the word "Law" in Article 31 of the Indian Consti tution, as pointed out by the learned Judges of the Supreme Court, in the State of Bihar v. Kameshwar Singh of Darbhanga (A I R 1952 S C 252). The essential question to decide, therefore is, what is the meaning In which the word "individual" has been used in subsection (3). The first impression is that the word "individual" includes a female, as the word is used in that sense in section 3 of the Income-tax Act. A close reading of the section shows clearly, however, that the word has been used in relation to a male and not a female. This subsection was considered and interpreted by the Supreme Court of India in Commissioner of Income-tax, Madhya Pradesh and Bhopal v. Sm. Sodra Devi (A I R 1957 S C 832). It was pointed out in it that the wording of the section is not happy and that the very manner in which all the four sub-clauses have been grouped together in section 16 (3) (a) and in the manner in which the expression "for the benefit of his wife and minor child or both" is used in section 16 (3) (b) renders the words "any Individual" or "such individual" ambiguous. There was no knowing with certainty as to whether the Legislature meant to enact with reference only to a male of the species by using the words "any individual'." or "such individual", in the narrower sense of the term to include only the male or in the broader sense to include the female of the species. In order, therefore, to resolve the ambiguity the learned Judges resorted to the state of law before the provision was enacted. Before section 16 (3) was introduced by the Indian Income-tax (Amendment) Act, 1937 (IV of 1937) there was no provision at all for the inclusion of income of the wife or a minor child in the computation of income of any individual for the purpose of assessment. Whatever may have been the income of a wife from the member ship of a firm of which her husband was a partner or from the assets transferred directly or indirectly by her husband otherwise than for adequate consideration or in connection with an agreement to live apart, her income was not included in the income of her husband in computing the income of her husband for the purposes of the assessment. Similar was the position of income derived by minor child from his admission to the benefits of partnership. In a firm of which such individual was a partner or assets were transferred directly or indirectly to the minor child, the income derived by such minor child could not be added to the income of the father for purposes of assessment. The income of the wife and the child could only be made the basis of a separate assessment. 4. Because the practice of making wives and children as nominal partners in the firms and businesses with a view to avoid the incidence of larger assessment became very common and was regarded as an evil, an Inquiry Committee was set up. It submitted its report in 1936 and made certain recommendations for remedying this wrong. The Committee suggested that the income of the wife or the minor child, as the case may be, should be included in the Income of the husband or the father in the computation of the total income for purposes of assessment. The mischief, if any, resulting from the mother's admitting their minor children to the benefits of partnerships in which they were members was farthest from the thoughts of the Inquiry Committee and was no where sought to be remedied. On a consideration of these recommendations, the Indian Income-tax (Amendment) Act, (IV of 1937) was enacted which introduced section 16 (3) of the Act. Though it is not legitimate to refer to the statement of objects and reasons, as an aid to they construction, or for ascertaining the meaning of any particular word used in the Act or Statute, it can be referred to for the purposes of ascertaining conditions prevailing at the time, which actuated the sponsor of the Bill to introduce the same, and the extent and urgency of evil, which he sought to remedy. The statement of objects and reasons, which led to the passing of the Act Is as follows: - "Reference is made in sections 1 and 4 of Chapter III of the Income-tax Enquiry Report, 1936, to the practice of avoiding taxation by means of nominal partnerships between husband and wife or parent and minor child or by the nominal transfer of assets to a wife or minor child (or to an 'association' consisting of husband and wife) when there Is no substantial separation of the interests of the assessee and the wife or child. These practices are reported to have become very widespread already with considerable detriment to the revenue, and there is little doubt that if they are not checked, there will be progressive deterioration. The proposals !n the Report regarding the aggregation of the incomes of husband and wife go beyond the immediate necessities of the case and to that extent their adoption would involve the admission of a new principle which the Government of India do not desire to establish in advance of the general public discussion of the Report which has been arranged ; and the present Bill has been so drafted as to deal only with the abuses to which I have referred." The above makes it clear that the evil sought to be remedied by the Act was one resulting from the wide-spread practice of husbands' entering into nominal partnerships with their wives and fathers' admitting their minor children to the benefits of the partnership of which they were members. This evil was sought to be remedied by subsection (3) of section 16 of the Act. If this background of the enactment of section 16 (3) is borne in mind, there is no room for any doubt that howsoever that mischief was sought to be remedied by the amending Act, the only intention of the Legislature in doing so was to include the income derived by the wife or a minor child, In the computation of the total income of the male assessee, the husband or the father, as the case may be, for the purpose of assessment. 5. On a consideration of these questions, the majority of the Judges of the Supreme Court came to the following con clusion: - "We are, therefore, of the opinion that the words 'any individual' and 'such individual' occurring in section 16 (3) and section 16 (3) (a) of the Act are restricted in their conno tation to mean only the male of the species, and do not include the female of the species, even though by a disjunctive reading of the expression 'the wife' or 'a minor child' of 'such individual' in section 16 (3) (a) and the expression 'by such Individual for the benefit of his wife or a minor child or both' in section 16 (3) (b), it may be possible in the particular instances of the mothers being connected with the minor children in the manner suggested by Revenue to include the mothers also within the connotation of these words. Such inclusion which involves different interpretations of the words 'any individual' or 'such individual' in the different contexts could never have been intended by the Legislature and would in any event Involve the addition of the words 'as the case may be' which addition is not normally permissible in the interpretation of a statute." We are in respectful agreement with the above view. It appears to us that the word "individual" in subsection (3) of section 16 has been used for the male and not for the female. The four clauses of section 16 (3) (aa) provide for the case of incomes of the wives and the minors. Clauses (i) and (iii) deal with the income of the wife in a firm of which her husband is a partner and from assets transferred directly or indirectly to the wife by the husband otherwise than for adequate consideration or in connection wits: an agreement to live apart, or so much of the income of a minor child of such individual as arises directly or indirectly. In the background of the legislation and in the context of the language used in the four clauses which provide for the income to be included in the income of the individual, the female does not appear to have been contemplated. 6. In a fiscal statute, if there Is an ambiguity, it must be so interpreted as to give the benefit of the ambiguity to the subject, If there is an ambiguity and the meaning be not wholly clear and there is no doubt that the meaning is not clear that the income of the minor was intended to be included in the income of the mother, then the section cannot be so interpreted as to make the mother liable to assessment at a higher rate by inclusion of the income of the minor. 7. We have considered the dissenting view of S. K. Das, J. in A I R 1957 S C (Ind.) 832 and the decision in 1959 Taxation Vol. 1 (111-312), arm the other cases cited above. In view of the decision of the Supreme Court, the cases reported as Chanda Devi v. Income-tax Commissioner. Income-tax Commissioner v. Damayanti Sahni and Sodradevi N. Daga v. Income-tax Commissioner M. P. (A I R 1955 Nag. 180) are no longer good law in India. These cases emphasize that the word "individual" is used both for the male and the female as in the charging section 3 of the Act it includes a female. It is significant however, that in India no amendment of section 16 (3) has been brought in by the Legislature to include "female", although the Supreme Court delivered its judgment in 1957. This gives some indication that it was not intended that females should be included within its purview. If it had been so intended, an amendment in the Act would, no doubt, have been brought. 8. In Akbari Begum v. Commissioner of Income-tax, East Bengal, it was held that section 16 (3) started with the words "in computing the total income of any individual for the purposes of assessment" which could not be lost sight of and there was nothing to show that there was any intention of excluding females from the term "any Individual" occurring there as In section 3 of the Act, which is a charging section. There is nothing to show that the individual excluded females. It was stated that if exclusion of females was intended some express words should have been used for the purpose. Reliance was placed on Srimati Chanda Devi v. Commissioner of Income-tax, U. P., but the decision of the Supreme Court in A I R 1957 S C 832 was not placed before the learned Judges. 9. Having considered the language of section 16 (3) (a) and the reasoning of the learned Judges of the Supreme Court, with which we respectfully agree, we hold that the words "any individual" do not Include the female and, thus, a mother of a minor child Is not Included in the term. Our answer, therefore, to the question, referred to us, is in the negative. In view of the fact that the decision of the Dacca High Court was to the contrary, we make no order as to costs. Reference answered in negative.