Commissioner of Income Tax, Meerut vs Shiam Lal Jitendra Kumar

The income tax Appellate Tribunal, New Delhi, has referred the following question of law u/s 256(2) of the income tax Act, 1961 (hereinafter referred to as ''the Act'') for opinion to this Court :-

Whether the income tax Appellate Tribunal was justified in law in directing to adopt the status as that HUF ?"

The present reference relates to the assessment years 1975-76, 1981-82 and 1982-83.

Briefly stated the facts giving rise of the present reference are as follows:

The respondent-assessee filed returns of income in the status of HUF. The assessing authority, however, took the status of the respondent-assessee as that of an Association of Persons and since the returns were filed in the status of HUF, the assessments were framed in the status of HUF on protective basis. It appears that there was a HUF in the name and style of Shiam Lal, consisting of Shyamlal, Surendra Kumar, Jitendra Kumar and other as co-parceners and Smt. Vidya Devi and others as members. A partial partition in respect of the aforementioned family was claimed with effect from 30th November, 1970 for which a memorandum was executed on 31st December, 1970. Certain assets were partitioned and reallocated amongst various groups. The income tax Officer has accepted the partial partition vide order dated 28th February, 1974. Another partial partition was effected on 1st December, 1971 with the memorandum being executed on 31st March, 1972. Certain assets were again partitioned and reallocated amongst various groups. This claim of partial partition was rejected by the income tax Officer. However, the Appellate Assistant Commissioner has accepted the claim of partial partition which order has been upheld by the Tribunal.

We have heard Sri Shambhoo Chopra, the learned standing counsel for the revenue.

It has been stated by the learned standing counsel that the partial partition has been accepted by this Court. In this view of the matter the Tribunal was justified in upholding the status of the respondent-assessee. We, accordingly, answer the question of law referred to us in the affirmative, i.e., in favour of the assessee and against the revenue. How-ever, there shall be no order as to costs.