COMMISSIONER OF INCOME TAX Vs. MAGANLAL VITHALDAS PANCHMATIYA

JUDGEMENT

(1.) THESE are applications under section 256(2) of the Income -tax Act, 1961 (the Income -tax Act), for directing the Tribunal to state the case and refer the following two questions, said to be law, for the opinion of this court : '(i) Whether, on the facts and in the circumstances of the case, the Income -tax Appellate Tribunal was justified in cancelling the Commissioner of Income -tax's order under section 263 ? (ii) Whether, on the facts and in the circumstances of the case, the Income -tax Appellate Tribunal was right in holding that the income arising from property received on partition by the assessee is assessable as the income of the Hindu undivided family ?'

(2.) SINCE the applications arise out of a common order of the Tribunal, though for different assessment years, namely, 1980 -81, 1981 -82 and 1982 -83, and involve common questions of law, they are heard together and are being disposed of by this common order.

(3.) M /s. Maganlal Vithaldas Panchmatiya is a larger Hindu undivided family consisting of Shri Maganlal Panchmatiya, his wife, Smt. Indirabai, their minor son, Amit, and major unmarried daughters. There was a partial partition of the said larger Hindu undivided family on October 31, 1978, in which property worth Rs. 49,693 was allotted to the smaller Hindu undivided family of Maganlal and Indirabai and property worth Rs. 44,951 was allotted to the smaller Hindu undivided family of Indirabai and minor son, Amit. The said partition was recognised by the Income -tax Officer under section 171 of the Income -tax Act. Maganlal Panchmatiya had and has individual income also which is returned in separate returns under the Income -tax. Two separate returns of income were filed by the two smaller Hindu undivided families disclosing income derived from the assets allotted in the partial partition. Assessments were made by the Income -tax Officer on that basis. The Commissioner of Income -tax in revisional jurisdiction under section 263 of the Income -tax Act, 1961, set aside the assessment order made by the Income -tax Officer in the case of the smaller Hindu undivided family of Maganlal and his wife and ordered that the said income should be included in the individual income of Maganlal. The Tribunal set aside the said order of the Commissioner. An application for reference under section 256(1) of the Income -tax Act was made before the Tribunal but it was rejected on the ground that there was no referable question of law involved.