1982 (9) TMI 87 - AT - Income Tax

Summary

Issues:
- Applicability of provisions of s. 64(1)(ii) of the Act to the assessee's case.

Analysis:
1. The appeal challenged the applicability of s. 64(1)(ii) of the Act to the assessee, an individual, for the assessment year 1977-78. The assessee, a former partner in a firm, received a commission and his wife received a share of profit from the same firm.

2. The Income Tax Officer (ITO) included the wife's share of profit in the total income of the assessee under s. 64. The assessee contended that s. 64(1)(ii) was not applicable to his case. The Appellate Commissioner (AAC) upheld the ITO's decision, leading to the appeal before the Tribunal.

3. The Tribunal considered the provisions of s. 64(1)(ii) which include income by way of salary, commission, fees, or any other form of remuneration from a concern in which the individual has a substantial interest. The Tribunal noted that the wife's share of profit did not fall under these categories.

4. The Tribunal highlighted that the assessee did not have a substantial interest in the firm. The Tribunal emphasized that the wife's share of profit did not qualify as "any other form of remuneration" as per s. 64(1)(ii). The Tribunal clarified the legal meaning of "remuneration" and concluded that the wife's share of profit did not fit this definition.

5. Consequently, the Tribunal allowed the appeal, ruling in favor of the assessee. The Tribunal held that the wife's share of profit should not be included in the total income of the assessee as it did not meet the criteria specified under s. 64(1)(ii) of the Act.

6. The Tribunal's decision was based on a thorough analysis of the relevant legal provisions and the specific circumstances of the case, ultimately leading to the deletion of the wife's share of profit from the assessee's total income.