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TMI Blog1987 (3) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in law in following the orders of the Settlement Commission for an earlier year without discussing the issue on merits. 3. The learned CIT(A) was not justified on the facts of the case in allowing a liability of Rs. 5,82,377 under the head ' Balrampur Tenantry War Loan '. 4. Issue in question being pending before Supreme Court of India, the learned CIT(A) was not justified in holding that 1/6th wealth was deductible as belonging to Sri D.P. Singh in his individual capacity. " 2. On scrutiny, the WTO found that the assessee had shown value of Neelbagh Palace at Rs. 3 lakhs. The assessee requested the WTO to accept the value as the property was purely residential according to section 7(4) of the WT Act, 1957 (' the Act '). He informed the value accepted for the assessment year 1971-72 was Rs. 3 lakhs. The WTO was of the view that the valuation shown by the assessee did not appear to be reasonable in view of the fact that the Palace was quite big and spacious, besides having land around it. He further, wrote in his order, the exact area of the land around the Palace was not known to the representative of the assessee. He considered 5 acres of land, of the Palace, could not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Duty and the Settlement Commission, we are satisfied that a chunk of land which was separately assessed by the WTO was considered as a part of Neelbagh Palace, in the valuation. The Appellate Tribunal while estimating the valuation, against the valuation of the Assistant Controller at Rs. 1,84,000 had considered the said portion of the land. However, we are not inclined to accept the submissions of the learned counsel for the assessee that the valuation adopted by the Settlement Commission for the assessment year 1971-72 should also be adopted for the year 1981-82. The value which was adopted by the learned ITAT in 1964 was Rs. 1,84,000. Even if the moderate rate of increase during a gap of about 10 years in valuing the property @ 10% is adopted, the value for 1981 could come to Rs. 4,05,418. We find that the WTO had added Rs. 1 lakh with Rs. 3,00,000 declared by the assessee is value of the property estimating the total value of Rs. 4 lakh. We, therefore, decline to interfere and confirm the orders of the lower authorities. The learned counsel for the assessee suggested that we must read section 7(4) in a manner that once the assessment for the assessment year 1971-72 had been com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hwari Prasad Singh and his family (Late Maharaja was married to Smt. Raj Laxmi Kumari Devi), they were issueless. On 20th February, 1963 they adopted Shri Dharmendra Prasad Singh (D.P. Singh) into family and so from that date the family was consisted of Late Maharaja, his wife and Shri D.P. Singh, the present karta. Late Maharaja died on 30th June 1964. The assessee-HUF claimed that after the death of Maharaja his share was devolved on his wife and D.P. Singh (Indv.) the present karta. Wife allowed her share to remain in HUF. Shri D.P. Singh was entitled to half of 1/3rd share in his individual capacity as per section 6 of Hindu Succession Act, 1957. It was claimed by the assessee-HUF that by operation of law, D.P. Singh has overriding titled to this extent in the HUF property. In the income-tax proceedings for the assessment year 1966-67, this issue was subject matter of the ITAT. The learned Tribunal after considering facts came into conclusion that the case of CIT v. Smt. Nagarathnamma [1970] 76 ITR 352 (Mys.) is applicable in this case. In that case, it was held that the deceased coparcener's interest shall devolve by testamentary or intestate succession under Hindu Succession ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. It is no doubt, he has got right according to the Hindu Succession Act. But unless and otherwise he gets his property separated definitely it will remain as HUF property and should be assessed as such. Whether or not there was a real partition in family to exclude any part of the property from the hands of the HUF for taxation purpose, a claim of partition shall have to be made otherwise it will be continued as HUF property if no claim is made and the claim is not accepted. Section 6 of Hindu Succession Act itself suggests that share of a coparcener will be determined on the basis of deemed partition if any body is claiming his share according to the said section, he has to put claim of the partition on the basis of the said section, he has to put claim of the partition otherwise it will remain as HUF for taxation purposes. This was the law laid down by the Hon'ble Supreme Court in the case of Kalloomal Tapeswari Prasad (HUF) v. CIT [1982] 133 ITR 690. We feel the decision of the learned Mysore High Court has been impliedly superseded by the Hon'ble Supreme Court. In view of above, we feel that the WTO was justified in rejecting the claim of the assessee to exclude 1/6th share ..... X X X X Extracts X X X X X X X X Extracts X X X X
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