| Case ID |
ff81c3dd-1cda-4a73-858b-63335d9b947f |
| Body |
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| Case Number |
Income-tax Reference No.224 of 1981 |
| Decision Date |
Jul 29, 1997 |
| Hearing Date |
|
| Decision |
The High Court upheld the decision of the Income-tax Appellate Tribunal that the wife of the assessee, Smt. Durgawati Singh, was a benamidar for her husband, Vijai Bahadur Singh. The Tribunal found that the business conducted under the name 'Friends Automobiles' was essentially owned by the assessee, and the income earned through it was assessable in the hands of the husband. The Court noted that the wife was incapable of managing the business and that the husband was the real owner. Consequently, the income amounting to Rs.33,495 was rightly added to the husband's taxable income. The decision clarified that the burden of proof regarding the benami nature of the transaction rested with the Revenue, which it successfully established through various evidences, including the lack of involvement of the wife in the business operations. |
| Summary |
This case revolves around the concept of benami transactions within the framework of the Indian Income Tax Act, 1961. The Allahabad High Court reviewed the case of Vijai Bahadur Singh, who was assessed for income earned through a business ostensibly owned by his wife, Smt. Durgawati Singh. The Income-tax Appellate Tribunal had determined that the business was a benami arrangement, where the real ownership lay with the husband. The court emphasized that the assessment of income from a benami transaction is crucial for tax compliance and highlights the responsibilities of individuals in reporting accurate ownership of businesses for tax purposes. The ruling reinforces the legal principle that the apparent owner may not always be the real owner, especially in cases where the spouse is involved. This case serves as an important precedent for future tax assessments concerning benami properties and transactions, ensuring that the true nature of ownership is recognized for tax liabilities. |
| Court |
Allahabad High Court
|
| Entities Involved |
Not available
|
| Judges |
OM PRAKASH,
R. K. GULATI
|
| Lawyers |
Not available
|
| Petitioners |
VIJAI BAHADUR SINGH
|
| Respondents |
COMMISSIONER OF Income Tax
|
| Citations |
2000 SLD 228,
2000 PTD 608,
(1998) 232 ITR 934
|
| Other Citations |
CIT v. A. Abdul Rahim & Co. (1965) 55 ITR 651 (SC)
|
| Laws Involved |
Indian Income Tax Act, 1961
|
| Sections |
256
|