JOSE Vs. COMMISSIONER OF INCOME TAX, KERALA

JUDGEMENT

(1.) This is a reference by the Income-tax Appellate Tribunal, Madras Bench, under section 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 March 31, 1961. The question referred is :

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

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