COMMISSIONER OF INCOME TAX Vs. INDERPAL

JUDGEMENT

(1.) THIS is a reference under Section 256(1) of the Income-tax Act, 1961, at the instance of the Revenue and the following question has been referred by the Tribunal for answer of this court, which reads as under :

(2.) THE facts giving rise to this reference are thus : THE assessee's wife, Smt. Pushpa Devi, became a partner in a partnership firm known as Shiv Shankar Soap Factory. THE capital invested by Smt. Pushpa Devi came out of funds, gifted to her by her husband, the present assessee. Smt. Pushpa Devi was a sleeping partner. THE Income-tax Officer clubbed the profit arising to Smt. Pushpa Devi in the income of her husband in terms of Section 64(1)(iii) of the Income-tax Act, as it then stood.