COMMISSIONER OF INCOME TAX Vs. TARSEEM KUMAR

JUDGEMENT

(1.) This reference is at the instance of the department under Section 256(1) of the Income Tax Act, 1961. The Income Tax Tribunal, New Delhi has referred the following question for the opinion for the opinion of this court.

(2.) The facts giving rise to the present reference are as follows :- The father of the assessee, namely, Shri Amar Nath was a partner in firm M/s Amar Handloom Factory, Sardhana. He died intestate on 4th June, 1971 leaving a credit balance of Rs. 77,456/- in the firm of M/s Amar Handloom Factory, Sarshana. The deceased left behind his wife, two sons and three minor daughters. The assessee who is resident individual was unmarried at the time of death of his father, received Rs. 15000/- as his share from the credit balance of Rs. 77,456/-. This amount was transferred to the personal account of the assessee on 31st June, 1971 in the aforesaid firm. Thereafter the assessee along with his brother Shri Vijay Kumar formed a new firm in the name and style of M/s Amar Tex, Sardhana. The assessee entered into the partnership of this new firm as representing his HUF in it and transferred Rs. 15000/- from his individual account to the alleged HUF account.

(3.) In the course of assessment proceedings the assessee claimed that the share income of the aforesaid firm belongs to his HUF. This plea was negatived by the Income Tax Officer, Circle 2(2) on the ground that the assessee was unmarried at the time of the death of his father. There was no HUF in existence at that time and the assessee has succeeded to Rs. 15000/- as his share in his individual capacity being son of deceased and not as Karta of HUF. This order was reversed by the Appellate Assistance Commissioner of Income Tax. The Tribunal has confirmed the order of the Appellate Assistant Commissioner of Income Tax.