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TMI Blog1984 (9) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... should have been assessed in the status of an individual and the income of the minor should have been included in the income of the assessee under section 64 of the Income-tax Act, 1961 ? " This matter was before us on August 31, 1984, and subsequently on September 10, 1984. On August 31, 1984, we had remanded the matter to the Tribunal for a fresh statement of case, as we were of the opinion that the reference could not be proceeded with without the two deeds of partition being on record, both dated March 22, 1968. After August 31, 1984, the Department had produced copies of the two partition deeds which were in Marathi. These were tendered and taken on the record on September 10, 1984. The Department also indicated that the Inspector at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y with his two unmarried daughters. The Appellate Assistant Commissioner relied upon the decision of the Supreme Court in N. V. Narendranath v. CWT [1969] 74 ITR 190 (SC). The Department carried the matter to the Income-tax Appellate Tribunal. The Tribunal held in favour of the assessee and dismissed the Department's contention, observing as follows: " Looked at either from the angle of the theory of potentiality or from the angle of the right of a daughter to an interest in the joint family property, which was, however, crystallised into a right to maintenance, the assessee in the instant case constitutes a Hindu undivided family with his two unmarried daughters and his wife though the wife was allotted separate share on the said partiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indicated on page 3 of the partition deed (pertaining to the larger Hindu undivided family). They include a house named "Tapascharya" at Bazar Peth, Khed, gold, jewellery, furniture and other household articles. The partition deed goes on to say that the parties, P. L. Khedkar and N. P. Khedkar, had decided to partition only the assets and liabilities relating to cloth business run in the name of P. L. Khedkar, which would suggest that as far as the other properties are concerned, namely, the house at Bazar Peth, Khed, gold, jewellery, furniture and other household articles, the status of the joint family would continue and the Hindu undivided family would own the said properties and if there was any income, actual or notional, flowing fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is between Narayan Prahlad Khedkar and Laxmibai Narayan Khedkar and their two minor sons, Sharad and Shirish. Both the sons have, in the matter of the partition, been represented by their father, the said Narayan. The partition deed very clearly pertains only to the amount of Rs. 71,000 received by Narayan as the head of his branch under the earlier partition of the larger Hindu undivided family which, as we have already indicated, was a partial partition in respect of the cloth business only. The deed pertaining to the partition of Narayan's branch records that the four persons had decided to effect a partition of the amount of Rs. 71,000 amongst the four of them and that consent to this course of action had been given on behalf of the min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, in his opinion, all these were required to be assessed as the income of an individual. This was presumably because the Income-tax Officer addressed himself only to the limited contention being advanced before him by the chartered accountant. In our opinion, it is unnecessary to go into the various legal authorities cited before the Tribunal, since it is quite clear to us that there was no full partition in the family of N. P. Khedkar by the second deed of partition dated March 22, 1968, nor did the second partition sever the status of the Hindu undivided family. There was merely a partition in respect of the amount of Rs. 71,000 among the four coparceners, namely, N. P. Khedkar, his wife, Laxmibai, and two minor sons. Thus, there wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e clubbed with his individual income under section 64 of the Income-tax Act, 1961. This is the ratio we have laid down in our decision in Income-tax Reference No. 71 of 1975, decided by us on September 6, 1984 [CIT v. S. K. Thakkar [1985] 154 ITR 303]. In this view of the matter and on the footing indicated above and not exactly on the footing which appealed to the Tribunal, we answer the two questions as under : " (1) The assessee was required to be assessed in the status of a Hindu undivided family inasmuch as there was no full partition nor cessation of the joint family status by the second partition deed dated March 22, 1968. (2) On the footing that the Hindu undivided family was being assessed and there was a Hindu undivided fami ..... X X X X Extracts X X X X X X X X Extracts X X X X
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