9911796707
TMI Blog1978 (2) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... property was not shown in his individual assessment. It is pertinent to mention that the assessee (HUF) was assessed from income from property for this building for the asst. yrs. 1970-71 to 1972-73 and the AO who assessed the assessee as an individual for the asst. yr. 1970-71 did not include the income from house property in the individual assessment of the assessee on the ground that the house had been thrown into the common hotch potch of the HUF on 1st Dec., 1969. However, during the asst. yr. 1972-73, the AO while making the individual assessment of the assessee perused again the declaration dt. 1st Dec., 1969 and found that the property was mortgaged to TISCO and the employer was not informed about the transfer. He, therefore, came t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... granted to the assessee. Accordingly he further observed that it is apparent that the appellant had no right of transferring the property on the date when the declaration was drawn up and, therefore it, has to be held that so long as the debts are not paid in full, he continues to be the owner of the property without any right of divesting himself of this title or interest thereon and if he does so, the latter transaction is void. The AAC thereafter considered the arguments of the assessee that if the assessee has committed any branch i.e., a branch of a contract between himself and his employer and that is the matter between them and the Department being a stranger to the contract, cannot use it against the assessee. The AAC rejected the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was that the building was mortgaged to TISCO and, therefore, the assessee did not have any right of transfer. The counsel stated that the first objection of the ITO has not been accepted by the AAC but the AAC has accepted the second objection of the ITO and consequently, he confirmed the inclusion of income in the individual assessment of the assessee. The counsel relying in 76 ITR 675 (SC) urged that there was no transfer of asset if an individual throws his property into the common hotch-patch of HUF. Under the circumstances, the finding of the AAC on the second objection of the ITO was incorrect and consequently, the inclusion of income should be deleted. The Departmental Representative very strongly relied on the orders of the authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee did not have right of transfer because the property was burdened with loan and it was mortgaged to TISCO. As the mode of throwing the property into the common stock of HUF did not amount to transfer, the objection taken by the AAC is incorrect in view of the Supreme Court decision. Thus, the inclusion of property income in the hands of the assessee individual could not be sustained. 4. The assessee has filed the assessment order of HUF for the asst. yrs. 1970-71 to 1972-73. It is clear from the assessment orders of the HUF that the property income has been subjected to tax in the hands of the HUF and the AO of the assessee individual for the asst. yr. 1970-71 did not include the income from property accepting the position that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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