JOSE Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) This is a reference by the Income Tax Appellate Tribunal, Madras Bench, under S.66(1) of the Indian Income Tax Act, 1922. The assessment year concerned is 1961-62; and the accounting period for the income involved in the reference, the twelve months ended on 31-3-1961. The question referred is:

(2.) The assessee gave his wife Rs. 5,000/- on 28 4 1960. She deposited the amount in a bank on 2-5-1960. She withdrew Rs. 4,000/- from that amount and contributed her share of the capital of Johnson and Company on 9-5-1960.

(3.) Johnson and Company is a partnership dealing in general merchandise including oil and oil seeds. The firm was constituted by a deed of partnership dated 3-5-1960. The partners were (and are) the assessee's wife and the assessee mother. The Rs. 4,000/- contributed by the assessee's wife on 9-5-1960 constituted one half of the capital of the firm. The other half was contributed by the assessee's mother in two equal instalments of Rs. 2, 000/-.