SATYANARAYAN KANHAIYALAL GAGRANI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is an IT reference made under Section 256(1) of the IT Act at the instance of assessee by the Income -tax Appellate Tribunal (for short hereinafter called as 'Tribunal') in R.A. No. 77/78/Ind/1996, which in turn arise out of an order, dt. 30th Sept., 1996 passed by Tribunal in ITA No. 498/Ind/1992 and ITA No. 806/Ind/1994 and later amended by Tribunal in Misc. Appln. Nos. 33/Ind/1996 and 34/Ind/1996, dt. 31st Jan., 1997 by invoking the powers of rectification under Section 254 of the Act for answering following two questions of law said to arise out of the two orders referred supra: (1) Whether on the facts and in the circumstances of the case, the Tribunal was right in setting aside the order of the CIT(A) and restoring the matter to the file of the AO to decide the issue to assess the income from the bequeathed property in the proper hands instead of deleting the said income from the hands of the assessee as there was no connection of the assessee HUF with the bequeathed property? (2) Whether on the facts and in the circumstances of the case, the learned Tribunal was right in holding that the property bequeathed by Smt. Radhabai did not belong to the different smaller HUFs?

(2.) IN order to enable this Court to answer the aforementioned two questions of law referred by the Tribunal, it is necessary to mention the material facts from the statement of case sent by Tribunal to this Court.

(3.) ON 9th Nov., 1981, one Radha Bai widow of..executed a Will in respect of her moveable and immovable properties whereby she (Radha Bai) bequeathed her Rs. 2 lakhs and jewellery to three smaller HUFs consisting of members of aforementioned bigger HUF in equal share i.e., 1/3rd to each HUF. The creation or we may say formation of these 3 smaller HUFs who got the aforesaid properties in 1/3rd equal share under the Will, from Radha Bai is described in Will as follows: I(HUF)(i) Satya Narayan (Karta) : father/husband(ii) Sushila Bai : wife/mother(iii) Sharad Kumar : sonII(HUF)(i) Satya Narayan (Karta) : father/husband(ii) Sushila Bai : wife/mother(iii) Harish Chandra : sonIII(HUF)(i) Satya Narayan (Karta) : father/husband(ii) Sushila Bai : wife/mother(iii) Sanjeev Kumar : son