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Issues Involved:
1. Whether the remuneration received by the karta, Shri P. S. Jain, from the companies can be treated as the income of the joint family. 2. The applicability of the Supreme Court's decision in CIT v. Kalu Babu Lal Chand [1959] 37 ITR 123 to the present case. 3. The relevance of the findings of the Income Tax Officer (ITO) and the Appellate Tribunal regarding the remuneration for services rendered by Shri P. S. Jain. Issue-wise Detailed Analysis: 1. Whether the remuneration received by the karta, Shri P. S. Jain, from the companies can be treated as the income of the joint family. The primary issue revolves around whether the remuneration received by Shri P. S. Jain from various companies should be considered as the income of the Hindu Undivided Family (HUF) or his individual income. The karta of the family, Shri P. S. Jain, received remuneration amounting to Rs. 9,300, Rs. 15,600, and Rs. 15,600 for the assessment years 1952-53, 1954-55, and 1955-56, respectively. The ITO initially included these amounts as part of the joint family income, but the Appellate Tribunal later found that the remuneration was a quid pro quo for the services rendered by Shri P. S. Jain and not related to the family's investments in the companies. The Tribunal allowed the assessee's appeal for the assessment year 1952-53 and dismissed the department's appeals for the subsequent years. 2. The applicability of the Supreme Court's decision in CIT v. Kalu Babu Lal Chand [1959] 37 ITR 123 to the present case. The Commissioner relied on the Supreme Court's decision in CIT v. Kalu Babu Lal Chand [1959] 37 ITR 123, where it was held that the remuneration received by the managing director was the income of the family and not the individual. However, the Tribunal distinguished the present case from the Kalu Babu Lal Chand case, noting that Shri P. S. Jain had considerable experience and rendered actual services to the companies. The Tribunal concluded that the shares held by the family had nothing to do with Shri P. S. Jain's appointment in these companies, and the remuneration was for his services. 3. The relevance of the findings of the Income Tax Officer (ITO) and the Appellate Tribunal regarding the remuneration for services rendered by Shri P. S. Jain. The ITO, in his remand report, accepted that Shri P. S. Jain had rendered services to the companies and that the remuneration was for those services. The Tribunal also found that Shri P. S. Jain had significant experience in the business carried on by the companies. The Tribunal's findings were based on the principle enunciated by the Supreme Court in Raj Kumar Singh Hukam Chandji v. CIT [1970] 78 ITR 33, which stated that if the remuneration is essentially for services rendered by the coparcener, it is the individual income of the coparcener, not the HUF. The Tribunal upheld this view and concluded that the remuneration received by Shri P. S. Jain constituted his individual income. Conclusion: The High Court upheld the Tribunal's view, stating that the remuneration received by Shri P. S. Jain was for services rendered and not a return on the family's investments. The question referred was answered in the negative and in favor of the assessee, concluding that the remuneration received by Shri P. S. Jain during the relevant assessment years was not assessable in the hands of the Hindu Undivided Family.
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