9911796707
TMI Blog1982 (3) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year 1979-80. The issue in this appeal is whether the AAC erred in holding that section 64(1)(vi) of the Income-tax Act, 1961 ('the Act') is applicable and as such the income accruing and arising to the minor Rakesh Kumar as share of profit from the firm of Karam Chand Rakesh Kumar is includible in the total income of the assessee. 2. The facts on the basis of which we have to det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party 15 per cent 1/3rd Rakesh Kumar minor 25 per cent nil 7. Karam Chand admitted into partnership for the benefits of the partnership. 8. That the parties shall contribute the finances towards the firm and they may or may not charge any interest on the finances so contributed." Smt. Parmeshri Devi being the grandmother of minor Rakesh Kumar, out of love and affection, gifted an amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e total income of the assessee. This was challenged in appeal but the AAC confirmed the assessment. 4. We have heard the parties and we do not find any justification for the action taken by the authorities below. A careful perusal of the instrument of partnership dated 13-5-1978 shows that Rakesh Kumar (minor) was admitted to the benefits of partnership. In this regard, a perusal of clause 7 mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtnership. 5. The learned counsel for the assessee rightly submitted that the gift made by the grandmother of the minor on 15-3-1979, cannot be considered as capital contribution by the minor for obtaining the benefits of partnership. This is so because, firstly, there is no requirement of law that a minor can be admitted to the benefits of partnership only by contribution of capital. Secondly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t must receive a strict construction. But in this case, no such strict construction is necessary because, on facts, the action taken by the authorities below was without any basis. We, therefore, allow the appeal of the assessee by reversing the orders of the authorities below and directing the ITO to exclude from the total income of the assessee the share of profit that the minor got from the fir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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