9911796707
TMI Blog1985 (12) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... ained rules in the Finance Act and, therefore, the provision of section 171 of the Income-tax Act, 1961 ('the Act') could not be applied to ascertain whether such net agricultural income belongs to the HUF or not. The revenue has taken exception to this reason by contending that the provisions of the Finance Act are supplementary to the provisions of the 1961 Act and when the claim of partial partition has been rejected under section 171, it cannot be taken into account for determining the net agricultural income that has to be added for rate purposes. On the other hand, it was contended on behalf of the assessee that the provisions of section 171 apply to income taxable under the Act with regard to the net agricultural income which is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itions to give effect to the partition and to recognise it under section 171. If a transaction does not satisfy the above additional condition, it cannot be treated as a partition under the Act, even though under the Hindu law, there has been a partition. The Finance Act provides for the aggregation of the net agricultural income with the total income only for purposes of charging income-tax in respect of the total income. Part IV of the Finance Act lays down the rules for computation of the net agricultural income. The Commissioner (Appeals) has laboured under the view that the Schedule to the Finance Act is a complete code in itself and, therefore, the provisions of section 171 could not be applied to determine the net agricultural income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act. Rule 12 of Part IV takes care of this by providing that the provisions of the 1961 Act and the powers of the ITO extend to the computation of the net agricultural income also. In the circumstances, even if we should assume that there is a lacuna by the omission to amend section 171 as was done by the Commissioner (Appeals), that lacuna has been filled up by rule 12. In the circumstances, we are convinced that the net agricultural income of the HUF has to be aggregated for the purposes of ascertaining the rate of tax applicable to the assessee, inasmuch as the partial partition has not been recognised under section 171. We, therefore, reverse the order of the Commissioner (Appeals) and restore the order of the ITO. The appeals are all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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