For the assessment year 1972-73 shri S. V. Kalkundri filed return of gift declaring taxable gifts of value of Rs. 1,56,865. total value of gift was Rs. 1,61,865 according to letter dated 22-12-1975 filed by Shri A. S. Kalkundri, son of Shri S. V. Kalkundri. GTO noticed that properties bearing Nos. 1691 and 1692 at Ramdeo Galli, Balgaum had actually been transferred on 6-4-1973 and relevant gift was assessable to tax only in assessment year 1973-74. donor subsequently died and his legal heir A. S. Kalkundri appears to have challenged assessment for year 1972-73. It is noticed that return filed by late Shri S. V. Kalkundri is in status of HUF. 2. when gift-tax assessment proceedings started under section 15(3) of Gift-tax Act, 1958 ('the Act'), for assessment year 1973-74, Shri A. S. Kalkundri contended that as property was that of HUF no gift could have been made to him and as such his father was not liable to gift-tax. GTO held as follows: "... In sense, assessee claims that property gifted was HUF property, who is having equal right in same and, therefore, gift is exempt. assessee's contention cannot be accepted. Late Sri srinivas V. Kalkundri was having 3 daughters and one adopted son, namely, Anand Srinivas Kalkundri. property gifted to him through registered deed dated 6-2-1973 was gift to his adopted son. As per section 13 of he Hindu Adoption and Maintenance Act, 1956, adoption does no deprive adoptive father of power to dispose his or her property by transfer inter verves or by will. This section is having overriding effect on Hindu law on adoption as per section 4 of Hindu Adoption and Maintenance Act. In these circumstances, gift given by late Sri S. V. Kalundri is properly made, and there is no question of his adopted son to get equal right, etc., Therefore, gift of residential house made through registration on 6-2-1973 is assessable for assessment year 1973-74." AAC disposed of appeal as follows: "I have carefully gone through order of gift-tax Officer. In my opinion Gift-tax Officer has discussed case we and that relevant facts of case have been properly appreciated. Under circumstances, I do not see any reason for interfering with Gift-tax Officer's order. appeal is dismissed." assessee is in appeal. 3. At outset, it is noticed that assessment for 1973-74 for wealth-tax has been made in status of HUF. We understand that for income-tax also status was that of HUF although it is not very clear from assessment order. HUF of Shri S. V. Kalkundri consisted of himself and his son A. S. Kulkundri. It appears that three daughters of Shri S. V. Kalkundri have already been married off. taxing authorities having already granted status of HUF in wealth-tax assessments, cannot easily resale from stand. Once status of HUF is granted, father will not have power of gifting away joint family property except under certain circumstances and to extent prescribed under Hindu law. These are dealt with in articles 225 226 of Mulla's Hindu Law, 15th edition. for our purpose article 226 is important. This runs as follows: "226. Gift by father or other managing member of ancestral immovable property within reasonable limits - Hindu father or other managing member has power to make gift within reasonable limits of ancestral immovable property for 'pious purpose's. But alienation must be act inter verves, and not by will. member of joint family cannot dispose of by will any portion of property even for charitable purpose and even if portion bears small proportion to entire estate. But now see section 30 of Hindu Succession Act, 1956." It would, therefore, appear that father cannot gift away his entire immovable property and that too for purpose other than'pious purpose's. Viewed at in this light, it appears to us that father was not competent to gift immovable property to his son. No doubt, in peculiar circumstances of this case, property would go from father to son as there are no other coparceners, subject, of course, to proviso to section 6 of Hindu Succession Act, 1956 and Explanation to section 30. 4. Reliance, however, is placed on section 13 of Hindu Adoption and Maintenance Act, 1956, which reads as follows: "13. Right of adoptive parents to dispose of their properties - Subject to any agreement to contrary, adoption does not deprive adoptive father or mother of power to dispose of his or her property by transfer inter verves or by will." commentary by learned author Shri Mulla is as follows: "Right of adoptive parents to dispose of their properties - Under law as provisos applied Hindu adopting son did not thereby deprive him-self of power he had to dispose of his separate property by gift or will. There was no implied contract on part of adoptive father, in consideration of gift of his son by natural father or mother, that he would not dispose of his property by gift or will. When, however adoption was made by member of joint family governed by Mitakshara law, adopted son became member of corparcenary from moment of his adoption, and adoptive father had no power either by deed or will to interfere with rights of survivorship of adopted son in coparcenary property. same principle applied where adoption was made by sole surviving coparcener. it must have been noticed from section 30 of Hindu Succession Act, 1956, that interest of coparcener in Mitakshara coparcenary property can now be disposed of by him by will notwithstanding law relating to joint family and joint family property although it is not competent to coparcener even now to dispose of by gift his interest in coparcenary property so as to defeat right of survivorship. property envisaged by section is, of course, property over which adoptive father or motherland had vested in him or her power of disposal and not property over which adoptive parent had no such right. Thus for instance gift of coparcener's property by adoptive father would be void and can be challenged by adopted son. present section is in accordance with law as it previously stop and as altered by section 30 of Hindu Succession Act, 1956. rule is simple and lays down that adoption of son or daughter does not deprive adoptive father or mother of power to dispose of his or her (disposable) property by transfer inter verves or by will. rule does not ideal with nature of rights of disposal of his or her property by adoptive father or adoptive Mother which must be regulated by other provisions and rules of law. It only lays down that adoption of son or daughter is nor per se to have effect of depriving adopting father or adoptive mother of rights to dispose of his or her property." (p. 1110) 5. It is, therefore, obvious that power given to adoptive father to dispose of property is as regards his separate property and not joint family property. moment son is adopted, he becomes member of family and will have rights of coparcener in joint family property. case of revenue would have been quite different if status of S. V. Kalkundri had been taken as that of individual and properties in question belonged to him in his individual capacity. Having once granted statues of HUF complexion of problem, changes. revenue's reliance on narration in gift deed, which point out that assessee was absolute owner of property, will not be of any help in light of taxing authorities' acquiescence in status issue. We understand that appeal for assessment year 1972-73 is still pending before ACC but question of immovable properties is not involved therein and appeal for that year has to be decided independently. From facts stated above, we conclude that Shri S. V. Kalkundri transferred joint family properties to his son, whilch is void in law. order of AAC is set aside. 6. appeal is allowed. *** A.S. KALKUNDRI v. GIFT TAX OFFICER