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TMI Blog1979 (9) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee for partial partition ? 2. Whether, on the facts and in the circumstances of the case, theTribunal was right in law in deleting the addition of Rs. 6,300 made to the income of the assessee-HUF for the assessment year 1970-71 ? " Shri Narain Das Wadhwa, constituted an HUF along with his son, wife and two unmarried daughters. He died on 19th January, 1964. After his death, his son, Krishan Lal Wadhwa, as karta of the assessee HUF, constituted by him, his mother and two sisters, was a partner in the firm known as M/s. Paxit Containers. On 15th May, 1969, there was a partial partition in respect of the amount of Rs. 60,000 which stood invested by the assessee-HUF in the said firm. The division of this amount amongst the members ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his request of the assessee as he was of the view that there must be at least two coparceners for the purpose of effecting a partition of the joint family property and as in the present case, there was only one male coparcener, the partition in question was not valid. He, consequently, rejected the claim of the assessee and by a separate order, added the sum of Rs. 6,300 to the income of the assessee-HUF on account of interest on Rs. 60,000 at 12% per annum for the period from 15th May, 1969 to 31st March, 1970, relevant to the assessment year 1970-71. On appeal, the AAC accepted the claim of the assessee and deleted the additions of Rs. 60,000 towards the assessable wealth of the HUF and Rs. 6,300 towards the income of the assessee-HUF, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the decision of the Supreme Court in the case of N. V. Narendranath v. CWT [1969] 74 ITR 190 (SC), there need not be at least two male members to form Hindu undivided family as a taxable unit for the purpose of the Wealth-tax Act. The expression 'Hindu undivided family' in the Act is used in the sense in which the Hindu joint family is understood in the personal laws of Hindus. Under the Hindu system of law, a joint family may consist of a single male member and his wife and daughters and there is nothing in the scheme of Wealth-tax Act to suggest that a Hindu undivided family, as an assessee unit, must consist of at least two male members. The position in the Income-tax Act is the same as in the Wealth-tax Act. When, for the purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his family arrangement would also tantamount to partition within the meaning of section 171 of the Income-tax Act, 1961. After all, partition means only severance of joint status and it is a matter of individual volition. All that is necessary to constitute a partition is a definite and unequivocal intention of a member of a joint family to separate from the family limitation and to enjoy his share in severalty. When the members, of an undivided family agree among themselves with regard to a particular property that it shall thenceforth be the subject-matter of ownership in certain defined shares, then the character of the undivided property and joint enjoyment is taken away from the subject-matter. It is open to the members of the joint fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereof, could partition the property of the joint Hindu family. In any case, by way of family arrangement, such a partition could always be made. In Ram Charan Das v. Girjanandini Devi, AIR 1966 SC 323, it has been observed that the word " family " in the context of a family arrangement is not to be understood in the narrow sense of being a group of persons who are recognised in law as having a right of succession, of having a claim to a share in the property in dispute. If the dispute which is settled is one between near relations then the settlement of such a dispute can be considered as a family arrangement. The court leaned strongly in favour of family arrangements to bring about harmony in a family and do justice to its various member ..... X X X X Extracts X X X X X X X X Extracts X X X X
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