COMMISSIONER OF INCOME TAX Vs. HARSHVADAN MANGALDAS

JUDGEMENT

(1.) THIS reference at the instance of the Revenue poses for our consideration the following three questions :

(2.) A few relevant facts leading to this reference deserve to be noted at the outset. The concerned assessment year is 1972 73. The respondent assessee is an individual. The financial year is the previous year. His total income was assessed by the ITO as per his order at Rs. 2,65,050 as rounded off as against the total income of Rs. 2,55,040 declared as per the original return dated August 29, 1972. The assessee later revised the return on June 6, 1974, and declared that whereas income amounting to Rs. 1,97,364 was taxable in his hands as an individual, the amount of Rs. 1,24,622 was taxable in his hands as Karta of the HUF which comprised by himself and his daughter. The total of the said two amounts maintained in the revised returns came to Rs.

(3.) THE assessee went up in appeal to the AAC. The AAC, following the principles laid down by the Supreme Court and various High Courts in the decisions referred to before him, held that the assessee was entitled to claim the status of a HUF in respect of the properties received by him on partial partition and that the ITO was not justified in including the income received by the appellant on partial partition in the individual income of the appellant assessee.