| Case ID |
2072e3bd-7246-42fa-8feb-8847fa3c3c47 |
| Body |
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| Case Number |
TAX CASE Nos. 38 TO 40 OF 1978 |
| Decision Date |
Apr 25, 1985 |
| Hearing Date |
|
| Decision |
The Tribunal's order was upheld, ruling that only fifty percent of the share income received from the non-exporting firms was to be assessed in the assessee's hands. The court recognized that the funds of the HUF were invested in various firms, and following the partition, the income was to be divided equally between the father and his minor son. The ruling also affirmed that the income from the export firms must be treated similarly, as there was no evidence to indicate that the father had separate funds invested there. Thus, the Tribunal was justified in concluding that the minor son was entitled to a share of the income derived from the family’s investments. |
| Summary |
This case revolves around the assessment of income from partnership firms under the Income-tax Act, 1961. The key issue was whether the share income from these firms could be considered as belonging solely to the assessee or if part of it should be attributed to the minor son, following the partition of the Hindu Undivided Family (HUF). The court examined the investments made by the HUF in various firms and determined that the income had to be divided equally post-partition. The ruling emphasized the principles of family law and taxation, reinforcing the importance of equitable distribution of income between family members. It serves as a significant precedent involving the taxation of HUFs in India, particularly in how income from family investments is treated in tax assessments. The decision has implications for tax liability claims, making it essential for legal practitioners and taxpayers involved in similar disputes to understand its nuances. |
| Court |
Madras High Court
|
| Entities Involved |
Not available
|
| Judges |
Chandurkar, C.J.,
Ramanujam,
Fakkir Mohammed, J.
|
| Lawyers |
J. Jayaraman,
Mrs. Nalini Chidambaram,
S. Swaminathan,
S.A. Balasubramaniam,
D. Bamachandran
|
| Petitioners |
Not available
|
| Respondents |
Commissioner of Income tax
|
| Citations |
1986 SLD 1719 = (1986) 160 ITR 370
|
| Other Citations |
CWT v. J.K.K. Angappa Chettiar [1979] 116 ITR 456 (Mad.),
Jakka Devayya & Sons v. CIT [1952] 22 ITR 264 (Mad.),
Kathoom Bi v. Abdul Waheb Sahib [1939] 2 MLJ 208,
N.C.T. Chidambaram Chettiar v. CT.A.CT. Subramaniam [1981] 2 MLJ 424,
Karnani Properties Ltd v. CIT [1971] 82 ITR 547 (SC),
CIT v. S.P. Jain [1973] 87 ITR 370 (SC)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
4
|