1994 (9) TMI 21

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..... -tax Act, 1961, in the assessee's individual assessment is not correct ?" These reference applications relate to the assessment years 1972-73 to 1974-75. The assessee is an individual. He was a partner in the firm, Rm. K. V. Textiles, representing the Hindu undivided family, consisting of himself and his wife. In making the assessment, the Income-tax Officer included the share income of the assessee's minor children, Viswanathan, Loganayaki and Seethalakshmi, from the firm for the respective assessment years under section 64(1)(ii) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The assessee preferred an appeal before the Appellate Assistant Commissioner, who directed the exclusion of such share income relying on the e .....

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..... essee, who relied upon the earlier decision of the Supreme Court in CIT v. Anand Sarup [1993] 204 ITR 361. The fact remains that in the present case the assessee filed his return as an individual. He is a partner in the firm in his capacity as karta of the Hindu undivided family. The minor children of the assessee were admitted to the benefits of the partnership firm. The Income-tax Officer included the minors' income from the firm in the hands of the father in his individual assessment by invoking the provisions of section 64(1)(ii) of the Act. The point for consideration is whether the income arising from the share belonging to the minor in the partnership firm is includible in the hands of the father, who is also a partner in the firm in .....

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..... the Act. In such circumstances, the above-said question arising in CIT v. Dharampal Ram Kumar [1994] 207 ITR 543 was not finally decided by the Supreme Court. Hence, we have CIT v. Anand Sarup [1993] 204 ITR 361 (SC), where the question arising in this reference was finally heard and decided. In view of the aforementioned discussion, we hold that the Tribunal was correct in its conclusion that the income arising out of the shares belonging to the minors in the firm is not includible in the hands of the father, who is also a partner of the firm in his capacity as the karta of the Hindu undivided family in his individual assessment in the status of individual. Accordingly, we answer the question referred to us in the affirmative and against .....

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