COMMISSIONER OF INCOME TAX Vs. MOKTAR BEGUM

JUDGEMENT

(1.) In this reference made at the instance of the Revenue, the Income-tax Appellate Tribunal has referred several questions. But the crucial question of law arising out of the Tribunal's order is whether the business income earned by a proprietary concern owned by a Muslim widow and her minor children could be assessed in the status of an association of persons.

(2.) For the assessment year 1966-67, the Income-tax Officer assessed the income of the concern in the status of an association of persons. This view was upheld by the Appellate Assistant Commissioner, but was reversed by the Tribunal. The Tribunal held that the assessment was properly to be made on the widow as a representative assessee, under Section 161 of the Income-tax Act, 1961.

(3.) One Imam Ahmed Khan carried on the business as a whole saler in fish, under the name and style of "Fida Hossain & Co." as its sole proprietor. He died on March 3, 1960. He left behind his widow, Mrs. Moktar Begum, and seven minor children. The widow continued the same business in the same name and style. The profits of the business were, at the end of each year, credited in the respective accounts of the widow and the seven minor children, according to their legal shares.