9911796707
TMI Blog1991 (7) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... ad not been explained. When the assessment was reopened the assessee stated that the HUF consisted of himself, his wife Smt. Chitra and his minor daughter aged 2 years by name Kum. Veena. It was further mentioned that Nichaldas Khubchand and Mitharam Nichaldas had made gifts of Rs. 40,000 and Rs. 35,000 respectively to the HUF of Nandlal Nihalchand and interest was earned by the HUF from deposit of said amount with M/s. Dhanwani Traders. The ITO held that interest income on the facts of the case could not be said to have been earned by HUF of Nandlal Nihalchand because there was no second male member in the family and there was no ancestral property. According to him, the amount received on gift belonged to Nandlal in his individual capacit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds as income of the HUF of Shri Nandlal Nihalchand, which has only one male member. 2. The learned Dy. CIT(A) has erred in law and on facts in finding that there was no doubt that a HUF was in existence of which Shri Nandlal was the karta. The assessee has sent written submissions and requested that the appeals be decided after considering the written submissions. The submission on behalf of the department is that the amounts which had been gifted to the HUF would belong to Nandlal in his individual capacity because at the relevant time he was the sole male member in the family and as such income derived from said amounts would be assessable as income of the individual and not that of HUF. In the written submissions the assessee has stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uestion was whether the income received by the assessee thereafter from the property should be assessed to income-tax in the status of HUF. The Supreme Court held that under the Hindu law till the birth of a son the assessee would be regarded as owner of the property in question and income from said property even after the property had been thrown in the family hotchpot was chargeable to income-tax in the assessee's hands as his individual income and not that of the family. In the present case of HUF of the assessee has received the amounts by way of gift from two persons. There is no qualitative difference between property received by way of gift and property received by throwing in family hotchpot. Throwing of the individual property in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is principle it must be held that the amounts received by way of gift in the present case belonged to Nandlal in his individual capacity till a son was born although the gift had been made to the HUF of Nandlal. This is because at the relevant time Nandlal was the only male member in the family. Hence the income derived in the relevant two years when Nandlal was the only male member in the HUF would be assessable in the hands of Nandlal as individual and would not be assessable in the hands of HUF of Nandlal. I therefore, set aside the order of the Dy. CIT (Appeals) and restore the order of the ITO holding that the interest income was assessable in the hands of Nandlal as individual. 5. The appeals are allowed - - TaxTMI - TMITax - In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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