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TMI Blog2004 (7) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... act that the assessee has been defined in section 2(7) of the IT. Act to mean a person by whom any tax or any other sum of money is payable under the Act. In the case of the minor, no tax is payable as his entire income is clubbed with that of the other person. The facts leading to the dispute briefly is as under. 3. In this case, the assessee has filed return by declaring income of Rs. 49,28,997 on 30-8-1995. The assessee is an individual, derived income during the year from the property concerned M/s. Fine Food, interest from private parties, salary from Lucky Enterprise. However, the Assessing Officer noticed the main source of income of the assessee was from long term capital gain on sale of shares and on sale of land. He, further not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income under the Act should be regarded as business income derived from business carried on by the assessee and in that view of the matter, the assessee is entitled to set off his loss carried forward from the previous year." Hence, disallowed the claim of the assessee. The matter was carried before the first appellate authority. 4. It was submitted before the CIT(A) that the assessee has claimed deduction under section 54F in the hands of the minor as the minor has no other residential premises of his own. It was further submitted the observation of the Assessing Officer that only a person who has assessed to tax could avail the benefit is incorrect. It was submitted that an individual includes a minor, a lunatic or an idiot, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson under section 64 of the Act. The learned CIT(A) held the issue is assessee's favour. He held that income includes capital gains. He held that though income is to be clubbed in the hands of the parents as per the settled law, the clubbed income shall be includes under the same head of income as in the hands of the real owner of the income for all purposes, is also a settled law. He held placing reliance of the decision of Kerala High Court in the case of CIT v. S.K. Naik [1984] 145 ITR 791 that what ever deductions due to a person even if his/her income is clubbed with other person, the deduction due to him should be allowed. This was a case where a wife received salary being Director of the Company for which the assessee was the Managi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of being an assessee. It is further submitted that section 64(1A) says that in computing total income of an individual, there shall be inclusion of such income as arised or accrues to his minor children. The word 'income' occur in section 64 has the same meaning as found. Clause (24) of section 2, under which income includes any capital gains chargeable under section 45. Under section 45 any profits or gains arising from the transfer of capital asset effected in the previous year shall be same as otherwise provided in sections 54,54B, 54D and 54EB, 54F, 54G and 54H be chargeable to income tax under the head capital gains and shall be deemed to be the income of the previous year in which such transfer took place. Thus section 64(1A) authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ouse of his own. If the minor in case was having such a house of his own, there was no difficulty in allowing his claim under section 54F of the Act. Only because minor is not having a house of his own, it cannot be said that he is not entitled for the benefits contemplated under this section. The business is carried on behalf of the minor by his parent. The CIT (A) in para 3 records that shares were held by assessee in Ramani Hotels Pvt. Ltd. bought on different dates between 1988 and 1993. Such shares were sold on 21-4-1994 for a consideration of Rs. 37,21,000. The capital gain worked out to Rs. 31,37,392, but, a residential house was bought for Rs. 31,99,000 in the name of assessee's minor son and it was claimed the benefit under section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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