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TMI Blog1984 (3) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire estate including the shares belonging to his mother and sister. For the years 1971-72 to 1975-76, the Agrl. ITO assessed the income of the estate treating the heirs of the deceased as tenants-in-common. But the Commissioner in exercise of his revisional powers thought that treating the assessee as a tenant-in-common was erroneous and prejudicial to the interest of the Revenue and he called upon the assessee to show cause why the assessment should not be set aside and why the agrl. income should not be brought to tax treating the legal representatives of the deceased, Sattar Khan, as an association of individuals. The son while resisting the proposed action, inter alia, contended that upon the death of Sattar Khan, the heirs automa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties in question should rightly be treated as an association of persons." Finally, the Commissioner set aside the assessment for the years 1972-73, 1973-74 and 1974-75 with a direction to the Agrl. ITO to redo the assessment treating the three persons in question as association of persons. The Commissioner's reference in his order to " association of persons " appears to be wrong and it must be in the context only " association of individuals ". He did not disturb the assessment for the year 1971-72 since the computation of income resulted in a loss. He also did not disturb the assessment for the year 1975-76, since the parties have availed of the benefit of composition under s. 67 of the Act. The petitioner has moved this court with an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... more persons join in a common purpose or common action, and as the words occur in section which imposes a tax on income, the association must be one the object of which is to produce income, profits or gains [see CIT v. Indira Balkrishna [1960] 39 ITR 546 (SC) and Commr. of Agrl. LT. v. Raja Ratan Gopal [1966] 59 ITR 728 (SC)]. On the facts found in this case, can we say, then, that the heirs of the deceased Sattar Khan joined together with a common purpose to earn agrl. income ? There was no such common venture or collective bargain. As usual, the estate was cultivated, both before and after the death of Sattar Khan, and the income therefrom was divided amongst themselves. It is a well accepted proposition that on the death of a Mohameda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome from the estate, but one of them collected the entire income from the estate. It was observed that they could not be regarded as an association of individuals as they did not form a unit or did not have any joint venture to earn the income. In B.T.R. Punja v. Commr. of Agrl. LT. [1966] 2 Mys LJ 275; [1967] 63 ITR 442 (Mys), this court, while considering the agrl. income derived by certain legatees under a will, observed that the legatees constituted tenants-in-common and not an association of individuals for the purpose of assessment under s. 3(3) of the Act. Mr. Rajendra Babu, learned Government advocate, however, strenuously relied upon the decision of the Patna High Court in Chowdhury Sharafat Hussain v. CIT [1956] 29 ITR 759, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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