9911796707
TMI Blog1982 (12) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... Name of the minor Interest Current a/c capital a/c Loan a/c Total . Rs. Rs. Rs. Rs. Kum. Beeha John 1,331 900 720 2,951 Kum. Marina John 1,331 900 720 2,951 Kum. Susam John 1,331 900 720 2,951 Kum. Reena John 1,332 900 720 2,952 According to the ITO all that was required to be established was proximity of the admission to the benefits of partnership and the income derived therefrom. He held that there was a direct and close affinity and, therefore, the amount in question had to be included. 2. In appeal the AAC referred to the decision of the Bombay High Court in CIT v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the Bombay High court in the case of CIT vs. Chandanmal Kasturchand 1977 CTR (Bom) 717 : (1978) 114 ITR 296 (Bom) and CIT vs. S.V.S. Nashte (1979) 12 CTR (Bom) 231 : (1979) 119 ITR 130 (Bom). According to him, there was no warrant for making any addition of the interest in the present case under the provisions of s. 64(1) (iii). 4. The ld. departmental representative relied on the commentry in relation to the provisions of s. 64(1)(iii) in Chaturvedi and Pithisaria's Income-tax Law, Third Edition, Vol. 2 of pp. 1845 and 1846 where there is a full narration of the case law for supporting the aggregation. He also submitted that the minors were required to contribute capital in terms of clause 4 of the partnership deed and since thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... precondition for the minors being admitted to the benefits of partnership and receipt of interest on such business did not have a direct nexus or even indirect nexus with the admission of the minors to the benefits of partnership. Having regard to the various judicial pronouncement referred to we consider that the ratio of the decisions of the Bombay High Court relied on by the assessee himself applies and there is no warrant for including the interest amounts in the current account and loan account, that is, Rs. 1,331 in each case in the current account (except in the case of Miss Reena John where it is Rs. 1332 and Rs. 720 in each case in the account, in the hands of the appellant under the provisions of s. 64(1)(iii) of the IT Act, 1961 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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