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TMI Blog1986 (6) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... rried on by the assessee's two sons Sri Mohanlal Rstogi and Sri Puskar Nath Rastogi were actually the businesses of their father since the initial capital for carrying on the two businesses had been gifted by the assessee. It was the assessee's case before the ITO that he gifted a sum of Rs. 5,000 to his son Sri Mohanlal which had been utilised by him to carry on separate cloth business independently. The ITO rejected the said explanation and held that "the assessee has not been able to produce any other evidence to show that the business carried on in the name and style of M/s Arvind Vastralaya and Janata Handlook Stores were started by his two sons from their own resources." Accordingly, he estimated the income from Arvind Vastralaya a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d a cross-objection claiming that the assessment should have been completed in the status of 'Individual' an not in the hands of the assessee as Karta of the HUF. 3. We have considered the submissions of both the rival parties. The departmental representative stated that while the AAC held that the assessment was invalid, he was wrong in retaining a portion of the income assessed in the hands of the assessee-HUF. It has been further stated that the AAC in excluding the income of M/s Arvind Vastralaya and Janata Handlook Stores relied on a certificate issued by the Panchayat Pradhan in violation of the provisions contained in r. 46A. I has been stated that before the ITO the assessee failed to establish that the aforesaid two businesses w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 wherein it has been held that the Tribunal was wrong in cancelling the assessment made in the status of 'individual' when the G.T. return was filed by the assessee as Karta of HUF. 4. The assessment has been made from a different filed is would be evident from the file No. noted in the ITO's order. The GIR No. Mentioned in the order passed by the ITO, Survey Circle for the asst. yr. 1974-75 is 38H which is different from the GIR No. Mentioned in the ITO's order for the assessment year under appeal. It seems therefore, that the ITO initiated proceedings separately on the basis of a survey report for including the income of the two businesses carried on by the assessee's sons as also the money lending business income carried on by the na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of his HUF. The mere fact that the capital was contributed by the assessee does not ipso facto lead to the conclusion that the income derived by the sons of the assessee belonged to the assessee representing his HUF. It was for the ITO to establish that the assessee being head of the family was in full control of the businesses carried on by the sons of the assessee. Even if we accept the revenue's contention that the AAC was wrong in placing reliance on the certificate issued by the Panchayat Pradhan that in itself. In our opinion, cannot justify the inclusion of Rs. 37,000 in the hands of the assessee, particularly when there is a clear finding that the sons of the assessee carried on independent business in dealings of cloth. We have me ..... X X X X Extracts X X X X X X X X Extracts X X X X
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