GADI CHELUVARAYA CHETTY Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE common question referred to this court by the Tribunal in these nine references under s. 256(1) of the I.T. Act, 1961 (shortly called "the Act"), reads :

(2.) THE facts necessary for answering the references are these :

(3.) IT will be seen from the above recitals that Chandra Mohan was given one-ninth share in the said business on the condition that he should manage the business. In the event of his ceasing to so manage the business, the other donees were to take his 1/9th share and make the necessary arrangement for carrying on the business. Chandra Mohan was not enamoured of the gift from his father-in-law. He did not accept the terms of the settlement, and so much so, his 1/9th share automatically reverted to the assessee and the other seven donees, in equal proportion and each of them became entitled to 1/8th share of 1/9th share. The income from the firm was assessed separately in the hands of the said partners as per their share of profits provided in the partnership deed for the accounting periods starting from March 31, 1963, and ending with March 31, 1969.