CHANDRAKANTH S P Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE common question referred under s. 256(2) of the I.T. Act, 1961, by the Income-tax Appellate Tribunal, Bangalore Bench, is as follows :

(2.) IN both the cases, the assessee is a Hindu undivided family ("HUF") consisting of the karta, his wife and minor children. The HUF is a partner through the karta in certain firms. IN the assessment proceedings for the year 1975-76, it has claimed deduction of a sum paid to the karta as remuneration for services rendered. IN I.T.R.C. No. 127/80, the deduction claimed was Rs. 12,000 and in I.T.R.C. No. 128/80, a sum of Rs. 6,000 was claimed. IN the previous assessment years such deductions were claimed to the extent of Rs. 4,800 and also allowed by the assessing officer. But, for the assessment year 1975-76, the ITO disallowed the claim on the ground that there was no agreement between the HUF and the karta for payment of remuneration to the latter.

(3.) THE contention urged, in our opinion, is sound and deserves to be accepted.