COMMISSIONER OF INCOME TAX Vs. RATNASWAMY K S

JUDGEMENT

(1.) AT the instance of the Commissioner of Income-tax, Madras, and on a direction by this court, the Income-tax Appellate Tribunal, Madras Bench, has referred to us the following questions of law and stated to us the case thereof:

(2.) THE facts are as follows: Subramania Kadavirar and Arumuga Kadavirar were brothers. THE assessee and two others, Ganapathi and Velayudam, were the sons of Subramania, and Ganesa is the only son of Arumuga. After the death of Subramania and Arumuga their sons formed a Hindu undivided family. But it is admitted that Subramania himself was born and bred in Ceylon and so is the assessee. THE assessee has his own business in Ceylon and has properties therein. All his eight children were born in Ceylon and, educated there. THE family had several non-residential buildings and one ancestral house in Qrathanad, Thanjavur District; It had also lands. All the joint family properties were managed by Ganesa, son of Arumuga. THE house was occupied by the step-mother of the assessee and his brothers. THE joint family properties were maintained out of the agricultural and rental income and the assessee never enjoyed any portion of the family income. THE assessee's movements, since 1946, were as under: <FRM>JUDGEMENT_303_ITR78_1970Html1.htm</FRM>

(3.) IN the earlier assessment proceedings action under Section 28(1) was also contemporaneously initiated by the revenue and penalty for the respective assessment years was imposed. The Tribunal in the view they have taken in the main proceedings, cancelled the levy of penalty as well. There were, therefore, eight appeals before the Tribunal in all of which the assessee succeeded. The subject has then come up before us to render an answer on the questions already referred to.