1976 (9) TMI 76 - AT - Income Tax

Summary

Issues:
1. Whether the income derived from properties on the death of the assessee's father intestate should be assessed in the hands of the assessee as his "individual" income or as Hindu Undivided Family.
2. Whether the properties derived from the assets of the father who died intestate and received from the maternal uncle were ancestral in character.

Analysis:
1. The Appellate Tribunal ITAT MADRAS-A dealt with departmental appeals concerning the assessment years 1970-71 and 1971-72, where the main issue was the assessment of income derived from properties on the death of the assessee's father intestate. The Income-tax Officer assessed such income in the hands of the sons individually, while the assessee claimed it should be assessed in the status of a Hindu Undivided family. The Appellate Assistant Commissioner, following a ruling of the Gujarat High Court, accepted the assessee's contention. The Revenue appealed, arguing that the properties should be assessed as the assessee's individual income. The Tribunal, after considering the arguments and rulings, upheld the order of the Appellate Assistant Commissioner, dismissing the Revenue's appeals.

2. The second issue revolved around whether the properties derived from the assets of the father who died intestate and received from the maternal uncle were ancestral in character. The Revenue contended that the properties should be assessed as the assessee's individual income, citing a specific decision. However, the assessee relied on the Appellate Assistant Commissioner's order and the Gujarat High Court ruling. The Tribunal, after analyzing the conflicting decisions, preferred to follow the ruling of the Gujarat High Court, which emphasized the mode of transmission by succession, leading to the properties being considered as belonging to the Hindu Undivided Family. Consequently, the Tribunal upheld the Appellate Assistant Commissioner's decision in favor of the assessee.