9911796707
TMI Blog1987 (3) TMI 169X X X X Extracts X X X X X X X X Extracts X X X X ..... also found certain investments in fixed deposits in the name of the assessee's wife on two dates amounting to Rs. 30,000. Rejecting the assessee's claim that the investments were made by his wife from her own sources, the Income-tax Officer treated the amount as income in assessee's individual hands. This constitutes the second point of dispute for the assessment year 1981-82. 4. For the assessment year 1982-83, the status of the assessee in regard to the income from medical shop is in dispute. 5. In the first appeal for the assessment year 1981-82, the Appellate Assistant Commissioner rejected the contention of the assessee that there was a partition prior to 19-4-1968. He accepted the version of the Income-tax Officer that the lands that were sold on 14-5-1958 belonged to the assessee's father in his individual capacity and even if the lands belonged to the Hindu undivided family, the money made available to the assessee upon sale of these lands way back in 1958 would have been exhausted to meet the educational expenses of the assessee. Thus, the question of any amount being available for purchase of shop from the assessee's brother on 26-3-1962 did not arise. The conduct of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he money that was available from out of the sale of the lands would have been exhausted by the time the medical shop was purchased in 1962 is only a surmise born out of suspicion. The assessee was then a minor and was undergoing training in D. Pharmacy at Visakhapatnam getting a scholarship from the Government. There is no evidence to hold that the share of sale proceeds of the lands had been spent on the education of the assessee. The assessee's father is not a man of straw. Apart from this sale, there was another sale of land on 21-5-1960 by the father of the assessee. In this sale, deed, the assessee's father alone is the vendor. These lands also belonged to the HUF. By this sale, a sum of Rs. 9,700 was received in cash. The balance of Rs. 6,800 was utilised for the discharge of debts incurred earlier. This amount was also available. Sri Swamy contended, alternatively, that even if the sale that took place on 21-5-1960 was held to be of lands belonging to the father of the assessee in his individual capacity, the very fact that there was mention of settlement of prior debts would amply prove that the father was maintaining the minor son from out of his borrowings and, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceforth. 9. Regarding the addition of Rs. 30,000, Sri Swamy submitted that the evidence produced was not appreciated in the proper perspective. The father-in-law of the assessee had informed the Income-tax Officer that at the time of marriage, his daughter Smt. Ramalakshmi received presents up to Rs. 5,000 and Rs. 7,500 was given by her father-in-law, thus amounting to Rs. 12,500, which was kept with him and advanced to ryots on interest from time to time since 1966. Discharged pronotes were also produced in support of advances having been made to the ryots and these shreds of evidence were brushed aside by the authorities below. In his deposition before the Income-tax Officer, the assessee had stated that there was a partition in 1960 in which gold and silver were distributed and in 1968 there was a partition of immovable properties. The wife of the assessee had also stated that the sources for the deposits of Rs. 30,000 were from the monies received from her father and the accumulations thereof on account of money-lending. In the light of this, there was no justification for adding these deposits held by the assessee's wife in the hands of the assessee. 10. Sri B. Kailasnath, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 1960 and was then a minor. There are two instances of sale of lands--one on 14-5-1958 and another on 21-5-1960. The assessee and his another minor brother represented by their father, the assessee's father and his major sons are described as vendors in the first sale deed. Sri Swamy argues that this fact in the registered document would clearly prove that the lands stated therein really belonged to the HUF as, otherwise, there would have been no need for the assessee and his brothers to have joined in the execution of the sale deed as vendors. Sri Kailasnath, on the other hand, argues that the sons joined in the execution of the sale deed only by way of abundant caution. We are unable to accept his contention for want of proof. The sale deed is staring at us and we have to go only by what has been stated in the sale deed. Therefore, we hold that the assessee had established that the lands covered by the sale deed dated 14-5-1958 really belonged to the HUF. The Income-tax Officer and the CIT (Appeals) erred in drawing a contrary inference. The same cannot be said of the sale deed dated 21-5-1960, because that sale deed was executed only by the assessee's father. It has been spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to this sale deed and the share of the minor would at least be Rs. 800. That was in the year 1958. Even assuming for the sake of argument that the father had not made any further improvement to this sum of Rs. 800, the said sum would certainly cover the purchase consideration of the medical shop which was only Rs. 713.88. Therefore, we hold that the medical shop was purchased only from out of ancestral nucleus. 14. In the list of partition dated 19-4-1968, there is a reference to an earlier partition in respect of immovable properties and movable properties excluding the properties mentioned in the list. Sri B. Adinarayana Murty, brother of the assessee, has stated that the joint family lands were sold by his father on 14-5-1958 and 21-5-1960, that there was a partition in 1960 in regard to silverware, gold jewellery and cash received out of sale proceeds of joint family lands sold by his father on 14-5-1958 and 21-5-1960 as also other movables. Sri Adinarayana Murty has stated that a sum of Rs. 6,000 was partitioned in cash in favour of his brother, the assessee. As against this, Sri Kailasnath refers to the deposition of another brother of the assessee Sri B. Satya Rao who ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter dated 24-10-1981 addressed to the Income-tax Officer that he received Rs. 7,500 from the assessee's father at the time of the marriage of his daughter Smt. Ramalakshmi. He also received presents up to Rs. 5,000 at the time of marriage and this amount was kept with him for advances to ryots for interest for some time and he paid Rs. 15,000 in all to his daughter. Smt. Ramalakshmi in her letter to the Income-tax Officer had confirmed the letter of her father and stated that the sum of Rs. 15,000 received from her father was advanced to ryots for interest and this sum together with the accumulations thereof amounted to Rs. 30,000 which she had invested in fixed deposits in the State Bank of India at Narsipatnam on two different dates. Sri Padmanabhuni Seetharam, the assessee's father-in-law, was also examined by the Income-tax Officer and a sworn statement was obtained from him. In his sworn statement, he had confirmed the contents of his letter referred to earlier. The case of the department is that these are all self-serving recitals to serve the interests of the assessee and that there is no corroborative evidence. Sri Swamy, on the other hand, pleads that discharged pronotes w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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