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Assessment to super-tax for the year 1931-32 of partners in a firm under the Income-tax Act; Whether partners should be assessed individually or as a Hindu undivided family. Analysis: The judgment dealt with the assessment of super-tax for the year 1931-32 of partners in a firm known as Moolji Sicka & Co. The controversy revolved around whether the six partners should be individually assessed for super-tax or if their shares should be treated as income of a Hindu undivided family. The rates of super-tax differed for individuals and Hindu undivided families, as per the relevant Finance Act. The interpretation of Section 55 of the Income-tax Act was crucial in determining the assessment method. The High Court at Calcutta was tasked with answering two questions in each case: whether the family of the assessee was a Hindu undivided family, and if so, whether the income in question should be treated as income of that family. The High Court answered the first question in the negative for each case, implying that the income should be assessed individually. The judgment delved into the family structures and relationships of the partners to determine the nature of the income and its assessability. The judgment highlighted the importance of whether the income from the firm was the separate and self-acquired property of the partner or part of a joint family property. The assessment hinged on whether the income had been thrown into the common stock of the family. The judgment differentiated between self-acquired and ancestral property, emphasizing that the mere existence of a wife or daughter did not convert individual income into joint family income. The assessment was based on the legal status of the income under Hindu law principles. The judgment critiqued the approach of the High Court in determining the nature of the income and the classification of the family as Hindu undivided. It emphasized the legal interpretation of the phrase "Hindu undivided family" and the ordinary legal meaning of income attribution. The decision was guided by the principles of Hindu law, specifically the Benares school, to ascertain the ownership and assessability of the income. In conclusion, the judgment advised that the appeals should be dismissed with costs. It provided a detailed analysis of the family structures, property ownership, and legal interpretations under Hindu law to determine the assessment of super-tax for the partners in the firm. The judgment clarified the distinction between individual and joint family income for tax purposes, based on the specific circumstances and legal principles involved.
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