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TMI Blog2019 (2) TMI 347X X X X Extracts X X X X X X X X Extracts X X X X ..... e property in question was mortgaged for borrowing loan for the family business. Therefore, this Tribunal is of the considered opinion that the property in question belongs to Hindu Undivided Family Under the Income-tax Act, Hindu Undivided Family is a separate and independent assessable unit. Since the property belongs to Hindu Undivided Family and the Hindu Undivided Family is an independent and separate assessable unit under the Incometax Act, this Tribunal is of the considered opinion that the gain arising out of sale of property has to be assessed only in the hands of Hindu Undivided Family and definitely not in the hands of individual coparcener. The assessee and his brother are individual coparceners. Therefore, there cannot be an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was registered in the names of minor children of Shri Sambanda Mudaliar. 4. Shri V. Nagaprasad, the Ld. representative for the assessee, further submitted that Shri Sambanda Mudaliar initially engaged in the business of leather trading in the name and style of B.S. Leathers. Subsequently, the proprietorship concern of B.S. Leathers was converted into partnership firm on 18.02.1987. According to the Ld. representative, there were four partners in the partnership firm consisting of Shri Sambanda Mudaliar and his three sons including Shri B.S. Murugesan. According to the Ld. representative, the partnership firm borrowed loan for business from State Bank of India, Walajapet Branch, mortgaging the land in question. Since it is a family p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tlement between State Bank of India and the company. Ultimately, according to the Ld. representative, State Bank of India s loan was cleared on payment of _6.5 Crores by way of one time settlement. The amount of _6.5 Crores was paid by Federal Bank Ltd. by taking over the loan from State Bank of India. In other words, the loan of State Bank of India to the extent of _6.5 Crores was taken over by Federal Bank Ltd. on 30.03.2007 and the securities given by the assessee and the business concern continued as such. 5. The Ld. representative for the assessee further submitted that the assessee s brother Shri B.S. Murugesan met with a road accident and died on 29.12.2007. According to the Ld. representative, the business of the company could no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.1979. The assessee s father, out of family funds, purchased the property in the name of the assessee and his brother Shri B.S. Murugesan. Therefore, according to the Ld. representative, it is a property belonging to Hindu Undivided Family. Hence, the capital gain on transfer of such land has to be at the best assessed only in the hands of Hindu Undivided Family. The Ld. representative has also alternatively submitted that the funds were invested by the assessee s father Shri Sambanda Mudaliar, therefore, it is his property and it cannot be assessed in the hands of the assessee in his individual capacity. Hence, according to the Ld. representative, the CIT(Appeals) is not justified in confirming the order of the Assessing Officer wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .12.1979 in the name of the assessee and his brother Shri B.S. Murugesan. On the date of purchase, the assessee and his brother were admittedly minors and they had no independent source of income. The income generated out of family business was invested in the property in question. The assessee being one of the coparceners, the property was purchased by his father in the name of the assessee and his brother. It is also not in dispute that the property in question was mortgaged for borrowing loan for the family business. Therefore, this Tribunal is of the considered opinion that the property in question belongs to Hindu Undivided Family of Shri Sambanda Mudaliar. 8. Hindu Undivided Family is not a legal entity under the common law. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X
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