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TMI Blog1992 (7) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... apuram and settled down there. He began doing business being a partner in Sri Ramakrishna Silk Palace in which he used to represent his family with 50% interest in it. In 1963 the family acquired agricultural land as well as house in Sakurru village and they also invested family funds in Sri Ramakrishna Silk Palace, Amalapuram. 3. It is the case of the accountable person that there was disruption in the joint family and severance in status had been settled from 31st March, 1963 and in fact from that date there was no joint family as such and the members of erstwhile joint family (namely the deceased and his three sons) were divided and enjoying their respective shares in the joint family properties as tenants-in-common and not as joint tenants and, therefore, on the death of the deceased which took place on 29th June, 1977, the lineal descendants share was not liable to be included for rate purposes under s. 34(1)(c) of the ED Act while making estate duty assessment against the estate left by the deceased. It is also the contention of the accountable person that both the Asstt. CED and the ACED went wrong in dismissing his plea that no aggregation of lineal descendants share is pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respective shares in our respective independent accounts in this firm. Apart from this we settled our joint family account where there was an investment balance of Rs. 104.87. Even that amount was divided into four equal shares by crediting our respective shares in it in our respective independent khatas in the joint family books of accounts. There are no other assets relating to the business which remained to be divided: Particulars of partitioned investment amounts: K. Subramanyeswara Rao 0-2-0 Rs. 22,659.40 K. Nageswara Rao 0-2-0 Rs. 22,659.40 K. Satyanarayana Murthy 0-2-0 Rs. 22,659.41 K. Sitharamachandra Murthy 0-2-0 Rs. 22,659.41 Credit :Rs. 90,637.62 . Rs. 90,637.62 The above said narration was admittedly made in the capital account of the deceased representing the joint family in the ledger books maintained by Sri Ramakrishna Silk Palace, Amalapuram. It was a partnership firm in which the joint family headed by the deceased held 50% share or interest. His three sons have got separate ledger accounts with the said firm. Further, the joint family maintained its own books of accounts. However, it was not the case of the accountable person that an agreement a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urnal as one of the cases in its Digestive Notes of Cases in (1986) (1) APLJ (DNC) page 8. In the headnote of the said decision the following is held: "Actual physical division or partition by metes and bounds is not an essential ingredient for the purpose of effecting severance in status. That is only a procedural formality to be undergone in the process of partition. Even without undergoing that formality severance in status could be had. Expression of an unequivocal intention to separate resulting in division of status is sufficient to bring about the severance of status. That is the question of fact to be decided on the merits of each case. Simply because properties are not physically divided and allotted to members, a partition will not cease to be such, provided there are no facts and circumstances evidencing severance in status. When severance is attained, the joint family status is definitely disrupted. A business as a going concern could attain a status of division even by dividing book balance. Mere specification of shares in the accounts will be sufficient to attain a divided status regarding a family business. For that purpose it is not necessary that there should be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ike M/s Ramakrishna Silk Palace, Amalapuram. It is the case of the accountable person that partial partition dt. 31st March, 1963 was recognised by the ITO by means of an order passed under s. 171 of the IT Act. If in fact there was division in status set in even on 31st March, 1963 and the members of the erstwhile joint family began separately living in pursuance thereof, the necessary allegation or recital in that regard would have certainly found place in the petition filed before the ITO for recognition of the partition dt. 31st March, 1963, since it can be fairly taken to be contemporaneous document. Necessary arguments before the ITO would have been advanced to recognise a total disruption of the joint family or a severance in status set into the joint family on and from 31st March, 1963. Necessary arguments in that regard would have been advanced before the ITO, who passed the s. 171 order. However, neither petition copy seeking recognition of partition nor the order passed thereon by the ITO, were filed before us. An adverse inference has to be drawn from their non-production and we have to presume that had they been produced they would go against the present plea of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anaged by Ramabhadra Raju since then. But 2, 3, 4 and 5 of us are not interested in such joint management and as No. 1 among us is being demanded by mother of 2 to 6 on their behalf for the partition of the said joint family properties, and as No. 1 of us being felt that it will be beneficial to partition the properties and cultivate the same individually than joint cultivation and management, for the improvement and enjoyment of the same and as No. 1 of us also wanted to partition the properties with others, we all have decided to partition our family properties." Parties 2 to 6 in the said partition deed are the minor sons and wife of Ramabhadra Raju. The above recitals bring out an intention to partition of the properties in the family in unequivocal terms. They felt that such a partition is for the benefit of the minors. So also No. 1 among them who is the father of the family as patria potestas is entitled to partition the properties himself and he exercised that right as is evidenced by the above recitals. Thus, the above case which was decided by the Tribunal bears no comparison to the impugned narration dt. 31st March, 1963. For instance there was no recital in the impugne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earlier decisions of the Tribunal are quite different from the facts of the present case before us and, therefore, those decisions of the Tribunal cannot be applied to the facts of the present case. From the impugned narration dt. 31st March, 1963 the intention is (sic not) to live apart from each other or to deny to themselves the right to go together or the privilege of having the right to reside jointly under the same roof, the right to have a common mess and the right of common worship. Therefore, in our considered view every partial partition with regard to some of the properties held by the joint family does not necessarily bring about a division in status. Even after a partial partition of the properties among its members, a joint family can still exist having commonality of residence, mess and worship. According to us, the lower authorities are perfectly justified in holding that the impugned narration did not bring about a division in status. On the other hand they are perfectly justified in holding that the integrity of the family is still maintained even after 31st March, 1963. It follows that even by the date of death of the deceased, the joint family in which the dece ..... X X X X Extracts X X X X X X X X Extracts X X X X
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