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TMI Blog1984 (10) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1967 in regard to the cloth business only. Its capital with the above business on 18th April, 1967 was Rs. 32,768.32. Out of this amount, Rs. 5,000 each were provided for the marriages of two daughters of Shri Nand Lal. The balance of Rs. 22,768.32 was equally divided at Rs. 7,589.44 each amongst his aforesaid three sons. The partial partition was accepted by the ITO vide his order dt. 21st Dec., 1968. A copy of this order appears at p. 7 of the paper book submitted by the assessee. 3. On 19th April, 1967 a firm of the name of the Badri Prasad Nand Lal was constituted. It consisted of two partners, namely, Shri Badri Lal Shri Ashok Kumar. Shri Girish Kumar, the third brother who was the minor at the relevant time, was admitted to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in their individual assessments upto the asst. yr. 1978-79. However, in the asst. yr. 1979-80 they claimed that they were partners in the above firm in their representative capacity representing their respective HUFs consisting of themselves and their respective wives. It may be mentioned here that Behari Lal was married on 13th July, 1967 while Ashok Kumar Girish Kumar were married in 1971 and 15th Feb., 1979 respectively. Their claim before the ITO was that with effect from the above dates they had become Kartas of their respective HUFs and, therefore, the share coming them was liable to be assessed as the income of their HUFs. 6. The ITO, however, rejected the claim of the above three assessees. As observed above, he found that ear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted before the AAC that once the investment in the firm was proved to have come out from the HUF, the share from the firm could also rightly belong to the HUF. I have already stated above that the investment in the firm was out of the amounts received by three persons of the partial partition of Badri Prasad Nand Lal (HUF). That fact was reiterated before the AAC. His attention was also invited to the preamble of the partnership deed dt. 20th May, 1967 which I have quoted above indicating that there was a partition in the family and the amounts received on that partition were invested by the above three persons in the newly constituted firm of the same name. It was argued before him that the mention of the representative capacity in the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the asst. yr. 1968-69. The ITO had accepted that there was a partial partition in the family of Badri Prasad Nand Lal. I have also stated above that a new partnership was formed on 19th April, 1967 i.e., immediately after the partial partition in the family. I have also quoted above from the partnership deed dt. 20th May, 1967 which exhibits the position as stated above. I have also gone through the various entries as recorded in the books of the HUF of Badri Prasad Nand Lal on 18th April, 1967 as also in the books of the firm of the same name constituted on 19th April, 1967. From these entries it is clear that all the above three assessees had invested the amounts received from then on partial partition of the family as their capital i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom his father and brothers, who formed an HUF on 17th Oct., 1962, and an amount of Rs. 3,216 was given to him as his shares. This amount was invested by him in a firm. At the time when he became a partner of this firm, he was unmarried but during the previous year relevant to the asst. yr. 1971-72, he married and he claimed that the share income received from the firm should be taxed in the hands of the HUF consisting of himself and his wife: Held, that an HUF came into existence when the assessee married and the share income from the firm could be assessed in the hands of the assessee as HUF." The above decision answers the contention of the department that a single male member could not constitute and HUF with his wife alone. The c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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