JUDGMENT

1. These are execution appeals against the order of the Additional District Judge <NAME>. The facts in all the cases are similar. I will first take Execution Second Appeal No, 4 of 1973.

2. <NAME>, appellant, instituted a suit for specific performance against M/s. <NAME>, respondents, for specific performance. This suit was instituted in June, 1963, in the court of the Subordinate Judge, Delhi. He decreed the suit on August 31, 1968, A decree for specific performance was passed in favor of the appellant

3. The appellant made an application for execution of the decree. He prayed for the delivery of possession of the plot of land which he had agreed to buy from the respondents. The res7aondents made an application under Section 47 of the Code of Civil Procedure to the executing court. Their sole objection was that the appellant was not entitled to get Possession of the property as no such relief was granted to him by the <ORG> and as none was asked for in the plaint in the suit. The executing court upheld the objection and dismissed the prayer of the appellant for delivery of possession.

4. The appellant appealed to <ORG>. His appeal was dismissed by the Additional District Judge on August 24. 1972. The appellant now appeals to this Court.

5. The suit was filed in June, 1963. It was decided on August 31, 1968 as I have said. During the pendency of the suit the new Specific Relief Act (Act 47 of 1963) came into force. On March 1, 1964, it was brought into force.

6. Section 22 of the new Act provides-"22. (1) Notwithstanding anything to the contrary contained in the Code of Civil Procedure, 1908, any person suing for the specific performance of a contract for the transfer of immovable Property may, in an appropriate case, ask for-

(a) possession, or partition and separate possession of the property, in addition to such performance; or

(b) any other relief to which he may be entitled, including the refund of any earnest money or deposit paid or made by him, in case his claim for specific performance is refused.

(2) No relief under clause (a) or clause (b) of sub-section (1) shall be granted by the court unless it has been specifically claimed: Provided that where the plaintiff has not claimed any such relief in the plaint, the court shall, at any stage of the proceeding allow him to amend the plaint on such terms as may be just for include three in a claim for such relief.

(3) The power of the court to grant relief under clause N of sub-section (1) shall be without prejudice to its powers to award compensation under Section 21 ."

7. This section makes it incumbent on a plaintiff to ask for possession of the property in addition to specific performance. Sub-section (2) provides that if in a suit for specific performance the plaintiff has omitted to ask for possession of the property in addition to specific performance no relief shall be granted by the court unless it has been specifically claimed. The effect of the section is that in a suit for specific performance prayer for possession must be distinctly and specifically made.

8. The courts below took the view that Section 22 applied to the suit of the appellant. He should have asked for the relief of possession and should have amended his plaint so as to bring it in line with the new section, they said.

9. Reference was also made to Section 44 of the new Act of 1963, which reads: " The Specific Relief Act , 1877, is hear by repealed."

10. On the basis of this section the courts below held that the legislature intended that the proceedings in the pending suits should also be governed by the new Act and not by the old Act.

11. When the appellant brought the suit in June. 1963, the, Act in force was the Specific Relief Act of 1877 (Act I of 1877). He instituted the suit under that Act. He claimed only a decree for specific Performance. He did not specifically ask for the relief of possession. The reason for this was simple. Under the old Act <ORG> had held that it was not necessary for a Plaintiff to ask for the relief of possession separately and specifically. Such a relief was comprehended in the decree for specific -performance. The claim to possession was involved in the claim to specific performance, the courts held. It was laid down in decided cases that possession can be asked for in execution of a decree for specific performance even though possession was not claimed in the Plaint on the ground that the relief of possession is merely incident to that of execution of a deed of conveyance: See <NAME> v <NAME>, and <NAME> v. <NAME>, .

12. <CITATION> , may be taken as fairly representative of the views which prevailed before the enactment of the new Act in 1963. <ORG> held that where in a suit for specific performance of a contract for sale relief for possession is not claimed and consequently the decree Passed in the suit contains no relief of delivery of possession, the court executing the decree is competent to deliver possession; an order directing delivery of possession being merely incidental to the execution of the deed of sale.

13. In that case the plaintiff filed a suit for specific performance of a contract and the suit was decreed. The plaintiff had also asked for delivery of possession of the property, but no mention was made in the decree about the delivery of Possession. The judgment debtor contended that the plaintiff having claimed Possession and possession not having been specifically granted in the decree, it must be deemed that the relief for possession was refused and the plaintiff could not claim delivery of possession.

14.The Division Bench rejected the argument and said: "We do not think there is any force in this contention. Section 55(1)(f) of the Transfer of Property Act of 1882 provides that "The seller is bound

(f) to give, on being so required, the buyer or such person as he directs such possession of the property as its nature admits; "The decree for specific performance, which provides that the property shall be sold to the plaintiff by the defendant and the sale deed shall be executed within -a certain time, failing which the court will have the sale deed executed by a person nominated by it, implies that delivery of possession shall be given in accordance with the provisions of Section 55(1)(f) T. P. Act. Delivery of possession is a necessary ingredient and part of transfer of owner ship. "The learned Judges continued:

"We do not think that it is necessary in a suit for specific performance either to separately claim possession or it is necessary for the court to pass a decree for possession. A decree for specific performance of contract includes every thing incidental to be done by one party or another to complete the sale transaction, the rights and obligations of the -parties in such a matter being indicated by Section 55 . T. P. Act."

15.The appellant therefore thought that according to the -prevailing view of the law then it was enough for him to ask for a decree of specific performance. So he brought the suit in that form.

16. On March 1, 1964, Specific Relief Act of 1963 came into force. This Act altered the law by enacting Section 22 . It made it necessary for a plaintiff to ask specifically the relief of possession in suits for specific performance.

17. Both the courts have held that it is the new Act, which applied to the appellant, and it was necessary for him to amend his plaint so as to claim the relief of possession. Since the appellant did not amend the plaint and did not ask for possession the court at the time of passing the decree did not give him the relief of Possession. Since the decree did not give him that relief the courts thought that they were powerless to put the appellant in possession of the property though he had a decree for specific performance in his favor. Therefore this decree became valueless to the appellants to all intents and purposes.

18. In my view, the courts have not taken the correct view. Section 22 is a new section in the Act of 1963. There was no corresponding or analogous Provision in the old Act. The new Section 22 therefore will apply only to suits which are instituted after the commencement of the new Act, that is, on or after March 1, 1964. I think this section does not apply to pending suits.

19. It is true that Section 44 of the new Act repealed the Specific Relief Act of 1877. What is the effect of that repeal? That is precisely the question to be determined in this case.

20. Section 6 of the General Clauses Act says:

"6. Effect of repeal where this Act or any Central Act or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made then, unless a different intention appears the repeal shall not-

(a) revive anything not in force or existing at the time at which the repeal takes effect; or

(b) affect the previous operation of any enactment so repealed or anything duly done or suffered the there under or

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed: or

(d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or

(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid and any such investigate, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed."

21. Under Section 6 the repeal of an enactment does not Prima facie affect [Pending actions which are to be decided as if the repealed enactment was still in force. This is the general rule: <CITATION> .

22. But when the repeal is fold lowed by fresh legislation on the same subject the court would undoubtedly have to look to the provisions of the new Act, but only for the purpose of determining whether they indicate a different intention.

23. The line of inquiry would be, not whether the new Act expressly keeps alive old rights and liabilities, but whether it manifests an intention to destroy them. I cannot therefore, subscribe to the broad proposition that Section 6 of the General Clauses Act is ruled out when there is repeal of an enactment followed by a fresh legislation. Section 6 would be applicable in such cases also unless the new legislation manifests an intention incompatible with or contrary to the provisions of the section. Such incompatibility would have to be ascertained from a consideration of all the relevant provisions of the new law and the mere absence of a saying clause is by itself not material: <CITATION> 1955 Sc 84.

24 .As <ORG> said in the case of (AIR 1955 Sc 84) (Supra). "Whenever there is a repeal of an enactment, the consequences laid down in Section 6 of the General Clauses Act will follow unless, as the section itself says a different intention appears. In the case of a simple repeal there is scarcely any room for expression of a contrary opinion."

25. Here in the new Act we have section 44 . This is a simple repeal. There is no saving clause ( Section 3 of the Act of 1963 though deals with "savings" contains no reference to the old Act of 1877). The repeal is followed by fresh legislation on the same subject. But there is nothing in the new Act to show an intention of the legislature to destroy the old rights and liabilities of the party which accrued under the old Act. The repeal of the old Specific Relief Act will not affect any right, liability acquired or incurred under the repealed enactment or any legal proceedings or remedy in respect of such tight or liability etc., and such legal proceeding or remedy may be continued as if the repealing Act has not been passed: See <NAME> v. Excess Profits Tax Officer. .

26. It is a settled principle of law that the rights of the parties to an action are to be governed by the law in force when the action was commenced that a change in the law would not affect pending actions unless there is a clear provision to that effect in the new enactment.

27. In general when the substantive law is altered during the pendency of an action the rights of the parties are decided according to the law as it exist-ed when the action was begun, unless the new statute shows a clear intention to vary such rights (Maxwell - Interpretation of Statutes 12th Edition, page 220). The rights of the litigants are generally to be determined according to the law in force at the date of the suit. If an alteration in the law occurs pending action the rights of the parties are to be decided by the law and equity existed when the action was begun.

28. In my opinion Section 22 did not apply to the appellant's suit. He was not bound to amend the plaint. The old law did not require him to do so. The new law does not apply to him.

29. A reading of Section 22 also shows that this section applies to those persons who sue for specific performance of a contract for the transfer of immovable property after the coming into force of the new Act. The opening part of the section says "any person suing for specific Performance of a contract". This shows that the legislature wants this provision to apply to those who instituted suits for specific performance after the new Act came into force. There is nothing in this section or in any other part of the Act to evince an intention on the Part of the legislature that pending suits be also governed by the new section. I think the section contains clear words, which show that the legislature has no intention that the Act should operate on pending proceedings.

30. The first appellate court was of opinion that the Specific Relief Act , 1963 merely deals with Procedure and does not affect substantive rights of the parties. Therefore. it applied to pending actions as well as to future actions. I cannot. I am afraid, share this view,

31. Section 22 enacts a rule of pleading. The legislature thought it will be useful to introduce a rule that in order to avoid multiplicity of proceedings the plaintiff may claim a decree for possession in a suit for specific Performance even strictly speaking, the right to possession accrues only when specific performance is decreed. The legislature has now made a statutory provision enabling the plaintiff to ask for Possession in the suit for specific performance and empowering the court to provide in the itself that upon payment by the Plaintiff of the consideration money within the given time, the defendant should execute the deed and put the plaintiff in possession: See the Ninth Report of the Law Commission Page 35.

32. Now this section modifying or amending existing rules of pleading was enacted when the appellant's action was pending in court. In such a case the statute should, unless it clearly appears to be intended otherwise. be held inapplicable: (See Crawford Statutory Construction, page 588).

33. It is true that as a general rule the law relating to Procedure operates retrospectively. No one has a vested right in the course of procedure. But there is another equally important principle, viz., that a statute should not be so construed as to create new disabilities or obligations or impose new duties in respect of transactions which were complete at the time the amending or the new Act came into force: See In re a Debtor 1936 Ch 237, In re Vernazza, 1960 Ac 965 and <CITATION> . of Bihar, . The same principle is embodied in Section 6 of the General Clauses Act.

34. Here it is well to remember the advice of Lord <NAME>:

"The canone of construction are not so rigid as to prevent a realistic solution.

"(<ORG> v. <ORG>.. (1965) 1 Wlr 892 (899) ).

35. 1 now turn to the other two appeals. In execution second appeals 1 of 1973 and 3 of 1973 the appellants Similarly brought suits for specific performance. The respondents raised the same objection. The respondents are same in all the three cases. <NAME> had agreed to sell three separate plots of land to these three appellants. The respondents' application under Section 47 was substantially the same in other cases as in execution case No. .4 of 1973. In these two cases also the respondents succeeded in the two courts. Now the appellants succeed. This judgment will govern all the three execution second appeals.

36. In the result the appeals are allowed. The orders of the courts below are set aside. Since there is no representation on behalf of the respondents in this court there will be no order as to costs.

37. Appeals allowed.


JUDGMENT <NAME>, J.

1. <NAME>, the father of the assessee was an agent of <ORG>, and he handled the sale of their pharmeutical preparations. He gave up that agency, and on July 1, 1937, the petitioner was appointed the company's agent.

(2) <NAME> died on 27th July, 1938. The assessee, the only son of <NAME>, inherited from his father a house in Ayalur Muthiah Mudali St., a sum of Rs. 3,000 realised on insurance policies, and Rs. 600 refunded by <ORG>. The case when into his banking account. On the death of <NAME>, the assessee was the sole male member of his family.

(3) In the assessment year 1938-39 the assessee's claim was upheld, that his appointment as the agent of the company did not constitute any succession to any business of Kulandavelu and that the agency and the business that ensued constitued the separate requisition of the assessee independent of his father.

(4) The agency proved lucrative, and the assessee acquired properties, moveable and immovable. His first son was born on 11th August, 1944, and the second on 3rd September, 1945. Together they constituted a joint family. The only piece of ancestral immovable property was the house in Ayalur Muthiah Mudali Street. That was sold by the assessee in 1945, and with the sale proceeds another house No. 3, Varadarajulu Naidu Street, was purchased. The new house was thus the substituted ancestral joint family property of the assessee and his sons.

(5) The assessee maintained only one set of accounts, which included the income-first from the house in Ayalur Muthiah Mudali Street and then the house in Varadarujulu Naidu Street. But that income was comparatively very small. The bulk of the income was from the agency business. Till the assessment year 1952-53 the assessee was assessed in his status as an individual on his entire income including the small amount which he derived from the ancestral immovable property.

(6) On 19th December, 1952, the assessee effected a partition between himself and his minor sons. Provision was also made for the maintenance, education and marriage of his daughter <NAME>, who was also a minor. The mother of the three minor children represented them in that transaction. The deed of partition has been appended as Annexure B to the statement of the case. In that deed of partition the assessee recorded :

"Whereas the party of the first part (assessee) has been earning commission and acquiring property and blending his money with the assets inherited from his father and treating the entire properties extant before and after the birth of the parties of the second and third parts (sons) till this date as joint family property without making any discrimination or distinction."

The moveable and immovable properties set out in Schedule A valued at Rs. 49,655 were allotted to the share of the assessee. The moveable and immovable properties valued at Rs. 83,650 were allotted to the share of the elder son <NAME>. The moveable and immovable properties valued at Rs. 1,20,000 were allotted to the share of the second son, <NAME>. The amount of Rs. 61,410 in fixed deposit was set apart for the maintenance, clothing, education and marriage expenses of the daughter <NAME>. It should be noted that the agency business itself was not made the subject matter of the partition. It continued with the assessee, and continued to be his separate property.

(7) In the assessment year 1953-54 for the account year ending with March 31, 1953, the assessee claimed that the entire income of the properties dealt with in the partition deed belonged to the joint family of himself and his sons upto 19th December 1952, and that thereafter he was liable to be assessed only on the income from the properties that came to his share under the deed of partition.

(8) The Income-tax Officer held that the only piece of joint family property was the house in Varadarajulu Naidu Street. The Income-tax Officer assessed the assessee in his status as an individual, as he had all along been assessed from 1938-39. The income from the house in Varadarajulu Naidu Street, which was treated an ancestral joint family in the hands of the assessee, was excluded. On the rest of the income, the income from the business and the income from all the properties shown in Annexure B, the assessee was assessed. The Income-tax Officer was of the view, that there was no proof of any merger of the self-acquired properties of the assessee to his minor children, and that the income from the transferred assets was assessable in the hands of the assessee under S. 16(3)(a)(iv).

(9) The assessee's appeal to the Assistant Commissioner failed. The Assistant Commissioner took the view that the deed of partition could not be acted upon, and that the income from all the properties belonged only to the assessee. Once again we should emphasise that the assessee income excluded the income from the ancestral joint family property, the house in Vadarajulu Naidu Street. The Assistant Commissioner did not go into the question whether the deed of partition dated 19th December, 1952, constituted a transfer, and whether the provisions of S. 16(3)(a)(iv) applied.

(10) The assessee appealed to the <ORG>. In paragraph 2 of its judgment, after passing out that the agency belonged to the assessee in his individual capacity from its commencement on 1st July 1937, and after also pointing out that no doubt a Hindu undivided family came into existence when the assessee's first son was born in 1944, the <ORG> recorded :

"...............there is no evidence that all his assets and liabilities including the agency business were transferred to such family either then or later. The first time we hear of the family possessing the assets in question is the deed of dissolution in which there is a recital to the effect "(The <ORG> consistently referred to anneuxre B, the deed of partition, as the deed of dissolution) "This certainly cannot constitute an unequivocal declaration of the admitted individual investing his self-acquired properties with the character of joint family property referred to in <CITATION> , (11) The conclusions of the <ORG> recorded in paragraph 3 of its judgment ran :

"We hold that the agency business of the assessee belonged only to him in his individual capacity till 19th December, 1952, after which he has by that document given away the shares therein to his three minor children. Such a mode of division comes within the ambit of S. 16."

The assessment made by the Income-tax Officer and confirmed by the Assistant Commissioner was confirmed and the appeal was dismissed.

(11-A) Even at this stage we have to point out that the assumption in paragraph 3 of the judgment extracted above, that shares were given to the three minor children in the business of the assessee, was wrong. The business as such, as we have pointed out, was not partitioned, and it continued to be the property, the self-acquired property, of the assessee.

(12) At the instance of the assessee the <ORG> referred the following three questions to this court under S. 66(1) of the Act :

"1-Whether there was material for the Tribunal to reach the conclusion that the various assets in question belonged only to the assessee in his individual capacity till 19th December 1952.

(2) If the answer to the first question is in the affirmative, whether the deed annexure B aforesaid amounted to a transfer of assets to three minor children aforesaid so as to attract the provisions of Sec. 16(3)(a)(iv) of the Income-tax Act ?

(3) If the answer to the first question is in the negative, the Income-tax Officer having rejected the claim of partition under S. 25A and the assessee not having independently appealed, against such decision, whether the assessee is entitled in law to any modification of the assessment order other than the status alone ?

We have referred to the recital in the deed of partition, annexuure B, that all along the assessee treated his properties as properties of the joint family of himself and his sons. He was the sole male member of the family before 1944. The accounts he maintained made no difference between the income from the ancestral property and the income from his self-acquired properties, which included the agency as well as the properties acquired with the accumulated income of that agency business. That system continued even after his sons were born. The <ORG> and the <ORG>, which agreed with them, were of the view, that there was no proof that antecedent to 19th December 1952, the assessee by his volition had blended his self-acquired properties with his ancestral joint family property. We are unable to hold that there was no material for that conclusion. There was no independent evidence to corroborate the recital in the deed of partition, that all along, the assessee had treated the property as the joint family property. His conduct before 19th December, 1952, was quite consistent with the position, that upto then he had all along treated the property and the income therefrom, inclusive of his ancestral property, as his property. As this karta of the joint family his income from the ancestral property was also at his disposal.

(13) The real question for determination under question (1) as it has been framed by the <ORG> is whether the assessee was liable to be taxed in his capacity as an individual and not in the capacity of the kartha of a Hindu undivided family on the income from the properties in the year of account upto 19th December 1952. Out of the total assessed income of Rs. 69,298, the income from the business itself, the agency claimed all along by the assesseee from 1937 as his self-acquired property, and that was itself not dealt with or shared with his sons under the deed of partition. The rest of the assessed income, a little over Rs. 15000 represented the income from immoveable property, dividends and interests, all traceable to properties acquired by the assessee from out of his accumulated profits of his self-acquired property, the agency business. Since there was material on which the <ORG> could come to the conclusion, that there was no clear evidence of blending of self-acquired properties with ancestral joint family property till 19th December 1952, the <ORG> was entitled to reject the assessee's claim that the income from all the properties including the agency should be treated upto 19th December 1952, as the income of the joint family of the assessee and his sons. That constitutes the real answer to question 1, though in form we answer the question in the affirmative and against the assessee.

(14) Question 2 : The transaction evidenced by annexure B, the document dated 19th December 1952, was in form and substance a partition between the assessee and his two minor sons, with a provision for the daughter as well for her maintenance, education and marriage. All the properties dealt with at that partition--the agency itself was excluded, but the ancestral immoveable property was included were expressly treated as the properties which belonged to the coparcenary, which consisted of the father and his two sons. A partition of joint family property itself does not constitute a transfer of assets, direct or indirect, within the scope of S. 16(3)(a)(iv) of the Act. A partition is based on the antecedent rights of the separating members of the family in the properties of that family.

(15) We have emphasised the feature of the transaction, that the bulk of the properties partitioned were the self-acquired properties of the father, the assessee. The only joint family property which was also ancestral was the house in Ayalur Muthiah Mudali Street, for which was later substituted the house in Varadarajulu Naidu St. Nonetheless the transaction evidenced by Annexure B was one of partition. As pointed out in <CITATION> , :

"The transaction by which a father makes a division of his self-acquired property between his sons is a transaction by which he, in the first instance, effects a severance of status between his sons, in the second instance, he notionally throws into the hotchpot his self-acquired property, and then divides it between his sons, whether fully or unequally in accordance with his pleasure."

The learned Judges also held that such a transaction did not amount to a gift and did not require a registered document to evidence it.

(16) Though we have held in answering the first question that the <ORG> was entitled to find that thee was no proof of blending of the self-acquired properties at any time before 19-12-1952, was there any proof of blending antecedent to the partition itself on 19-12-1952 still remains to be answered. The partition proceeded on the basis that the self acquired properties were made available for partition along with the only item of joint family property. That itself constituted proof that antecedent to the partition, however short the interval, there was a blending of the self-acquired properties of the assessee with his ancestral joint family property. We are in respectful agreement with the principle laid down by <ORG> in .

(17) In , this court observed at page 361 (of ITR) : (at p. 624 of AIR) :

"The assesee and his sons undoubtedly constitute members of a joint Hindu family. They might have started with no ancestral nucleus or other joint family property but there was nothing to prevent the assessee from impressing upon any self acquired property belonging to him the character of joint family property. No formalities are necessary in order to bring this about and the only question is one of intention on of the part of the owner of the separate property to abandon his separate rights and invest it with the character of joint family property. Where an inference of this sort is sought to be deduced from the conduct of the parties, there might be room for ambiguity and for difference of opinion. Where, however, it is the declaration of the owner of the separate property that is the evidence before the court or the <ORG>, the inference that the character of joint family property is impressed upon the separate property follows, unless the words are incapable of that construction or if it represents merely a future intention not yet given effect to." These principles were quoted with approval and applied by a Division Bench of <ORG> in <NAME> v. <NAME>, 1957-2 Andh WR 16 : (AIR 1958 Andh Pra 145).

(18) The <ORG>, it should be observed, was of the view that the recital in the deed of partition " did not constitute an unequivocal declaration of the admitted individual investing his self-acquired properties with the character of joint family property." Whether the averment in relation to the past was supported by other evidence or not, it certainly was unequivocal, that the properties dealt with at the partition were treated by the volition of the assessee as the properties available for partition between the members of the joint family. It was certainly an unequivocal declaration that all the properties dealt with under that partition had been impressed with the character of joint family properties, properties belonging to the joint family of the assessee and his sons. The genuineness of the transaction itself was never in issue. The result was that at least on 19-12-1952, antecedent to the partition, the properties became impressed with the character of joint family property. There was a partition on 19-12-1952. Thereafter the properties allotted to the shares of the assessee and his divided sons were held by them in severalty.

(19) The real question we have to decide is, was there a transfer of assets within the meaning of S. 16(3)(a)(iv) when the father, the assessee, pooled his self-acquired properties with the ancestral joint family property for subsequent division between the members of the coparcenary. If there was a transfer at all, the transferee could only be coparcenary of which the father was the kartha, and not the minor sons, who at the time were still undivided in status. It should be remembered that the pooling or blending of the self-acquired properties with the joint family property preceded in status and the partition of the properties on 19-12-1952.

Where the self-acquired properties of a coparcener--in this case the coparcener was the father of the other coparceners and the kartha of the coparcenary--are pooled with joint family properly and partitioned, there are three distinct stages. First the self-acquired property of the coparcener is impressed with the character of the joint family property of the coparcenary. The next stage is the disruption of the coparcenary. The members thereafter become divided in status. The next stage after that is the actual division between the divided members of what had been the property of the joint family. Each of these stages may be separated from the succeeding one by an interval of time, considerable or otherwise. The length of the interval however does not affect the principle in deciding the question, was there a transfer of property at any stage. Obviously no question of transfer of assets can arise when all that happens is separation in status though the result of such severance in status is that the property hitherto held by the coparcenary is held thereafter by the separated members as tenants-in-common. Subsequent partition between the divided members of the family does not amount either to a transfer of assets from that body of the tenants-in-common to each of such tenants-in-common. We therefore come back to the question "Was there a transfer to the coparcenary from the coparcener, that is, in this case was there a transfer for the assessee of his self-acquired properties to the coparcenary of which he was the kartha ?

(20) Severance in status with the resulting change in the nature of the ownership of the property is one of the incidents of a <ORG>. The property held by the <ORG> vests in the separated members as tenants-in-common after the severance in status. That result can be brought about by the unilateral exercise of the volition of the separating member or members of the family. At that point of time the property, which had up to then been impressed with the character of joint family or <ORG> property, becomes impressed with the character of property held in severalty by the tenants-in-common. The change does not itself constitute a transfer. Nor even does it result from any transfer of assets.

(21) Similarly, when the separate property of a coparcener ceases to be his separate property and becomes impressed with the character of coparcenary property there is no transfer of that property from the coparcener of the coparcenary. It becomes joint family property because the coparcener, who owned it upto then as his separate property, has by the exercise of his volition impressed it with the character of joint family or coparcenary property, to be held by him thereafter along with the other member of the joint family. It is by his unilateral action that the property has become joint family property.

(22) <ORG> property ceasing to be joint family property of the <ORG>s on a division in status between them and becoming thereafter the property held in severalty by the divided members, and the property of a <ORG> ceasing to be his and becoming the property of the <ORG> of which he continues to be member, are both incidents of a <ORG> governed by the <ORG> school. Either can be brought about by the unilateral action of the <ORG> concerned. Neither transaction amounts to a transfer of property from one juristic entity to another. A transfer is essentially a contract, a bilateral transaction. The transaction by which a property ceases to be the property of a <ORG> and becomes impressed with the character of <ORG> property does not itself amount to a transfer. No transfer need precede the change. No transfer ensues either. As pointed out in 1955-28 ITR 352 : ((S) AIR Mad 623), no formalities are necessary in order to bring this about, and the only question is one of intention on the part of the owner of the separate property to abandon his separate rights and invest it with the character of joint family property. Annexure B afforded clear evidence of an unequivocal manifestation of intention on the part of the assessee to treat his self-acquired properties as the properties of the joint family and to divide them on that basis.

(23) When a change in the character of even immovable property is achieved without a transfer and any need for a transfer for that property, no question can obviously arise whether such a change, viewed as a transfer would be invalid if it is not evidenced by a registered deed.

(24) The learned counsel for the department contended that, where a coparcerner throws his self-acquired properties into the hotchpot for purposes of partition, there is an element of transfer, within the meaning of Sec. 16(3)(a)(iv). The learned counsel referred to the observations of <NAME>, J, in <CITATION> 1943-11 ITR 16 at p. 33 (AIR 1943 Pat 169 at p. 174) :

"The property of an individual cannot become the property of a joint Hindu family be mere expression of intention unless the property is transferred to the joint Hindu family by some meaning recognised by law, for instance if it is moveable property then it should be handed over to the joint family and its subsequent possession or enjoyment should be shown to be on behalf of the joint Hindu family, or if it is immoveable then it must be transferred by a registered document if its value is more than Rs. 100."

The observations of <NAME> J were similar to those of <NAME> J., in <CITATION> , 32 Ind Cas 955 at p. 960 : (AIR 1917 Mad 706 at p. 711).

"Whether a member of a joint Hindu family who owns immoveable property as his self-acquisition can convert it into joint family property without an instrument in writing registered in the provinces where the Transfer of Property Act is in force, I think, admits of doubt.........I find some difficulty in understanding the conversion of individual property into joint family property except by way of a transfer. That transfer may be by way of a gift or it may be by way of an exchange, it is also possible that it may be by way of a sale it is no doubt true that the Transfer of Property Act does not provide for all kinds of transfers, but on analysis it will be found that such a conversion would partake of a character of one or the other of those transactions."

The learned Judge however stated :

"But I do not think it necessary to come to a final determination of either of these two questions."

The observations of <NAME>, cannot therefore be viewed even as obiter dicta. The correctness of these observations was doubted by <NAME>, J., in <CITATION> , 51 Mad LJ 167 : (AIR 1926 Mad 963). <NAME>, J, too died not record any concluded opinion of his on the question, whether conversion of individual property into joint family property could be effected only by a transfer.

(24) No case has been brought to our notice where this court has decided that there is a transfer when a copracener merges his separate property with the property of the joint family. With all respect to the learned Judges of <ORG> we are unable to share their view, that the property of a coparcenar can become the property of the joint family only if there is an antecedent valid transfer of that property. As we have pointed out, the change is effected by the unilateral action of the coparcenar, and that right of his to make his property the property of the joint family is one of the incidents of a coparcenery.

(25) We need not deal in this case with the right of a Hindu father governed by the Mitakshara to partition his self-acquired properties alone between himself and his sons, even without taking the initial step of making it all the property of the joint family or himself and his sons. In this case, antecedent to the partition between the assessee and his sons, he merged his self-acquisitions with the ancestral property of the joint family, which the assessee had the undoubted right to do. There was a partition of all the properties thereafter. Neither transaction, neither the pooling nor the subsequent partition, consitutued a transfer of assets, direct or indirect, within the mischief of Sec. 16(3)(a)(iv) of the Income-tax Act .

(26) The result is that after 19-12-1952, the income from the properties allotted to the minor children including the daughter belonged only to them, and it was not the income of the assessee. The transaction by which that property became the property of the minors, evidenced by the deed of partition annexure B, did not amount to a transfer of assets to any of the minor children within the meaning of Sec. 16(3)(a)(iv). The assessee was therefore entitled to exclude with effect from 19-12-1952 the income from the properties allotted to the minors under annexure B from his assessable income.

(27) We answer the second question in the negative and in favour of the assessee.

(28) The third person does not really call for an answer, becuase that in no way affects the tax liability of the assessee in the assessment year 1953-54. It was true that the assessee's attempts to have the income assessed upto 19-12-1952 as income of the joint family failed. So did the attempt to secure a declaration under Sec. 25-A and the joint family had ceased to exist, and that all the properties had been divided. The correctness of the order under Sec. 25-A itself is not the subject matter of this reference. As we have pointed out under question 1, the asessee was liable to be taxed on the entire income upto 19-12-1952 in his status as an individual. That was independent of the order under Section 25-A . In answering the second question we have pointed out that after 19-12-1952 the assessee was entitled to exclude from his assessable income the income from the properties allotted to the minor children under annexure B. That again was independent of any order under Sec. 25-A.

(29) In form we answer the third question in the affirmative and in favour of the assesseee. The assessee will be entitled to the costs of this reference. Counsel's fee Rs. 250.

(30) C. M. P. No. 127 of 1960 : The documents produced by the assessee were really unnecessary for the determination of the questions at issue between the department and the assessee. It is on that ground that we direct that the petition be dismissed. No order as to costs.

GE/C (31) Questions answered accordingly.