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TMI Blog1975 (10) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... were divided into 18 shares and wherever possible properties were also divided by metes and bounds. Only certain properties were left out and these are mentioned in paragraph 5 of the partition deed. Such properties were listed in "A" Sch. which described the property as Malavaram properties which had not been surveyed. Paragraph 5 mentioned that it was not proper to divide these properties just then and so it will be kept as common property but it was also made clear that each one of the members had 1/18th share therein. By paragraph 11, Smt. Parukutty Moopilamma was authorised to manage the properties which had not been divided by metes and bounds. 3. The Malavaram properties consisted of thick forests. By two applications to the Distri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aps suggested that the members should be assessed directly. The ITO held that the receipts are income in nature and after allowing certain expenses assessed it in the hands of the assessee as BOI. 5. In appeal, the AAC held that there was no income as such but there was capital gains. He also rejected the contention that the income was agricultural. Regarding status, he held that the correct status was AOP". 6. The assessee is no further appeal before us. The learned counsel submitted following the decision of the Supreme Court in Vishnu Datta Antharjanam's case that trees standing on land is part of land. He further submitted that the Supreme Court in the case of State of Kerala vs. Gwalior Rayon Silk Manufacturing (wvg) Co. Ltd. (1973 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lantation of Eucalyptus. This could be interpreted as an activity or venture. In the third alternative, he submitted that the status would be BOI. 7. We are unable to accept the submission of the counsel for the assessee that trees are part of the and so it should be exempt under s. 2(14) from being treated as a capital asset. This point has already come up before the Kerala High Court in Travancore Tea Estates Co. Ltd. vs. CIT reported in 93 ITR 314 (Ker). It was observed therein that the principle that what is attached to land belongs to the land is not applicable in India. Trees which stand on agricultural land are not agricultural land in India' within the meaning of s. 2(14)(iii) of the IT Act. They constitute 'property of any kind' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een defined. An actual divisions of the property by metes and bounds is not necessary. Once the shares are defined, whether by an agreement between the parties or otherwise, the partition is complete. After the shares are so defined the parties may divide the property by metes and bounds or they may continue to live together and enjoy the property in common as before. But whether they do the one or the other it affects only the mode of enjoyment but not the tenure of the property. The property ceased to be joint immediately the shares are defined and thenceforth the parties hold the properties as tenants-in-common (Mulla on Hindu Law, Page 372, para 322).The recital in the contracts cannot have the effect of taking away the right to the oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of Commr. of Agrl. IT vs. Raja Rajan Gopal 59 ITR 728 (Ker) they pointed out that the heirs did not form a unit for the promotion of any joint enterprise to earn income, profits or gains. The collection of the entire income from the estate by one of the shares will not make that income an income from joint venture. Each of the shares gets his income as individual and not as an association of individuals. This decision not only answers the point regarding AOP as the status but it also answers the question as to who is the person to be assessed. It will be clear from the decision that the individual members should be assessed direct and the capital gains computed has to be divided into 18 shares as each individual member has that much rig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ren running a business. That case does not help us here because that was clearly a case of business and so there in an object of producing income or profits. We are not concerned with business here. We are only concerned with a transfer of a capital asset from which there need not be any action in unison. It appears to us that the property owned by the unit of Body of Individuals should be joint tenancy and not co-ownership or tenancy-in-common. The income should first accrue to the BOI. Nobody should have a clear title to it apart from being a member of the BOI. Otherwise, the inclusion of BOI in s. 86(v) would become meaningless. It is now well settled that after partition the members one the properties not yet divided by metes and bounds ..... X X X X Extracts X X X X X X X X Extracts X X X X
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