COMMISSIONER OF INCOME TAX Vs. HADIGE RANGAPPA SETTY
LAWS(KAR)-1966-7-10
HIGH COURT OF KARNATAKA
Decided on July 06,1966

COMMISSIONER OF INCOME-TAX, MYSORE Appellant
VERSUS
HADIGE RANGAPPA SETTY Respondents

JUDGEMENT

Somnath Iyer, J. - (1.)THIS reference, sought by the Commissioner of Income-tax, under section 66(1) of the Indian Income-tax Act, 1922, has for its source an assessment for the assessment year 1960-61. The assessee is Rangappa Setty who unsuccessfully made several attempts during the earlier period to have an assessment made on the basis that the income was the income of a Hindu joint family.
(2.)IT is undisputed that on December 8, 1958, a partition deed was executed, under which properties were allotted to Rangappa Setty, his wife and his three sons. One of the properties so allotted was the shop in which the Rangappa Setty conduct his business.
The contention of the assessee was that by the execution of the partition deed in this way, there was a throwing of the self-acquired properties of Rangappa Setty into the hotchpot of a Hindu joint family and the coming into being of a partnership between Rangappa Setty, his wife and two of his sons. But the Income-tax Officer repelled these contentions and assessed the income from both the properties as well as from the business as the individual income of Rangappa Setty The Appellate Assistant Commissioner, who did not discuss the question whether a partnership was formed under the partition deed, shared the view taken by the Income-tax Officer that the income could not be assessed as the income of the Hindu joint family.

In the further appeal preferred by Rangappa Setty to the Appellate Tribunal, he was able to secure an order by which it was directed that the income for the period commencing from July 1, 1958, and ending on December 7, 1958, should be assessed as the income of Rangappa Setty and that the income for the latter period ending on June 30, 1959, should be assessed as the income of an unregistered firm.

(3.)IN this situation, the Commissioner of INcome-tax sought a reference and the question of law before us reads :
"Whether, on the facts and in the circumstances of the case, the assessment of the assessee in the status of an 'individual' was correc ?"

Mr.Rajasekhara Murthy, appearing on behalf of the Commissioner, asked to us to say that the Tribunal was in error in thinking that there was at the time when there was the execution of the partition deed on December 8, 1958, a declaration of Rangappa Setty by which his individual properties became transformed into those of a Hindu joint family and he submitted that there was no such declaration and that the partition deed contained none, and that, without an express declaration in that form, there could be no throwing of the property of Rangappa Setty into the hotchpot of a Hindu undivided family.



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