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S. Kannan, Accountant Member

1. These two appeals by the assessee are directed against the common order dated 27-12-1990 of the CIT (Appeals) I, Cochin, in Appeal Nos. ITA 6/Inv/CIT/90-91 and ITA 7/ Inv/CIT/90-91, respectively relating to the assessment years 1982-83 and 1983-84.

2. The issues that arise for consideration in this case are better appreciated against the backdrop of the relevant factual data. There was a joint family called "Cheranalloor Swaroopam", a Nair taravad. The assessee, it is common ground, was a member of the joint family. It is also common ground that the joint family owned various properties, Including three temples (Paramara Bhagwati temple, Sasta temple and Sri Chakram temple) and the properties belonging to the said temples. The management of the estate of the family (including the three temples and the properties belonging to them) was taken over by the Government of Cochin by Proclamation V/1117(ME) dated 28-11-1941 issued by the Maharaja of Cochin. The properties comprised in the estate of the joint family were initially managed by the Diwan Peshkar of the erstwhile Cochin State. On the formation of the State of Kerala, the properties, excepting the temples and the properties belonging to them, were managed by the District Collector, Ernakulam. As for the temples and the properties belonging to them, by a Notification issued by the Government of Kerala on 17-11-1961, the Secretary, Haindava Seva Sangam (a registered charitable society) was appointed to manage the affairs of the three temples and the properties appertaining thereto.

7. The return for the assessment year 1982-83 was accompanied by a note dated 25-8-1982, which reads as under:

The income earning assets (shop buildings) are constructed on the Parama temple ground. The assessee got the Pattam right over the said land as per the Pattam deed No. 424 of 1971 executed by Shri Narayanan Kartha, the Karanavar of Cheranalloor Swaroopam in favour of Radhakrishna Kartha (the assessee) for an annual Pattam of Rs. 200 p.a. A true copy of the said deed is herewith enclosed. As per the said deed, an obligation is created on the assessee for the proper maintenance and upkeep of the temple including the conduct of pooja etc. As an obligation is created, the expenditure incurred by the assessee for the temples is an allowable expenditure (It is an outgoing from the receipts). According to the custom prevailing for the last so many years, the temple should conduct festival in every year.
The Income-tax Officer proposes to assess the petitioner on the ground, that, he is receiving rent frombuildings situate in Survey Nos. 134 and 135 of Erankulam Village. It is submitted that the rent of the building is received by the petitioner for Paramara group of temples, which is a religious institution. The temples are managed by the petitioner, income derived from the rent of the building is collected by the petitioner and used for religious ceremonies like Thalapoli and other daily needs of the temples. On that ground alone, the, petitioner is not liable to be taxed. The property in which the buildings were situate, belongs to Cheranalloor Swaroopam which is a joint Hindu family. The assets of the said joint Hindu family were managed by the District Collector, by a royal proclamation issued by the erstwhile Cochin State as proclamation No. 1117. There was a condition in the said proclamation that if 2/3 of the members of the Swaroopam requires, the Government was bound to surrender the assets of the Swaroopam and management of the temples, and as such, when demanded by the members of the Swaroopam the Government handed the immovable properties and movable properties to the Karanavan of the Swaroopam in the year 1971. But the temples and properties attached to the temples were surrendered by District Collector only by the decision of the Hon'ble High Court in O.P. 6510/71.
The petitioner was appointed as administrator of the temples and its properties.
The members of the Swaroopam filed petition suit as OS 134/70 & 264/ 74 in the Sub-Court Ernakulam for a preliminary decree for partitioning the movable (sic) properties of the Swaroopam including the property in which the buildings at present situate and also for framing a scheme decree for the management of the temples. The above suits were decreed. There were 104 members in the Swaroopam. Now they have applied for final decree, for division of both movable (sic) properties belonging to the Swaroopam and including the property in which the temples and other buildings are situate, by metes and bounds, and also for accounting and for framing a scheme decree for the temples, and its properties and the buildings. Hence, the income that is derived from the buildings, after the expenses of the temples, to be divided among the members of Swaroopam, and the petitioner has to be accounted. The final partition proceedings in OS 284/74 is pending now in the Sub-Court.