9911796707
TMI Blog2015 (8) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi High Court by one of the parties to the dispute. The Hon'ble single Judge vide interim judgment dated 17.2.84 of the Hon'ble Delhi High Court dealt with the properties of Shri B.D. Gupta and business in the name and style of Gupta Sports House. It was held that these immovable properties and sports business were acquired by Shri B.D. Gupta with his own funds and not with the funds of HUF. The Hon'ble Single Judge determined the undisputed share of all the family members at 60%. It was directed that undisputed share of 60% be given to the respective parties. The remaining 40% was held to be disputed. Some Administrator was appointed. 3. Shri Ramnik Gupta, a family member of Sh. B.D. Gupta, filed return for the year under consideration declaring remaining 40% of income in the hands of B.D. Gupta and Sons (HUF). The AO taxed 100% of the income as HUF's income. The assessee carried the matter before the first appellate authority, who held that only 40% was taxable in the hands of the assessee HUF. The Tribunal affirmed the view taken by the ld. CIT(A). The Revenue approached the Hon'ble High Court. Before any decision by the Hon'ble High Court, a Family settlement was arrived a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le High Court directed: "that business will have to be taken over and managed under the supervision of the receiver." Again, in para no. 32, it has been mentioned that Shri B.L. Anand, Advocate appointed as a Local Commissioner will go to the said shop (Gupta Sports House, F-25, Connaught Circus, New Delhi.) for making inventory of the goods and account books lying there. This discussion indicates that the business carried on by Gupta Sports House was part and parcel of consideration by the Hon'ble Delhi High Court in its interim order. The observations of the ld. CIT(A) on page 16 of the impugned order that the Hon'ble Delhi High Court had not appointed any receiver for the business income and interest income, is factually unfounded. 5. In this regard, it is observed that simply because the assessee inadvertently filed return of income in the capacity of HUF would not make HUF liable to any tax unless income actually belongs to HUF. In the same way, the provisions of section 171 of the Act providing that a hindu family hitherto assessed as undivided shall be deemed for the purposes of this Act to continue to be a hindu undivided family, except where and in so far as a finding of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... house property, business and interest, then where should it be taxed? In other words, who is the right person chargeable to tax in respect of the income? On a specific query about the correct person in whose hands this income should be taxed, the ld. AR submitted that the same can be taxed only in the hands of beneficiaries as per the Settlement and the assessee has no relation with them and it is up to the Revenue to find such beneficiaries. I find that the Family settlement took place in the year 2004 and it is from such date that the shares of the beneficiaries came to be defined. In such circumstances, it cannot be said that the Family settlement shall be considered to have retrospective effect in the sense that when during the period anterior to such settlement, including the year in question, there were no defined shares of the beneficiaries, it should be presumed that the share in disputed income also belonged to them in terms of family settlement and tax be levied accordingly. In this regard, it is pertinent to note the mandate of the relevant part of section 159, which reads as under :- "159. (1) Where a person dies, his legal representative shall be liable to pay any su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year or part thereof as is included in the period from the date of the death to the date of complete distribution to the beneficiaries of the estate according to their several interests. (4) In computing the total income of any previous year under this section, any income of the estate of that previous year distributed to, or applied to the benefit of, any specific legatee of the estate during that previous year shall be excluded; but the income so excluded shall be included in the total income of the previous year of such specific legatee. Explanation.-In this section, "executor" includes an administrator or other person administering the estate of a deceased person." 11. A bare perusal of sub-section (1) of section 168 divulges that the income of the estate of the deceased shall be chargeable to tax in the hands of the executor. Sub-section (4) clarifies that if any income of the estate stands distributed to, or applied to the benefit of any specific legatee of the estate during that previous year, then that part of the income shall be excluded from the total income of the executor. However, such income shall be included in the total income of the previous year of such specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
