KASTURBHAI MAYABHAI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference relates to the asst. yrs. 1972 73 to 1976 77. The facts leading to the present reference may be noticed.

(2.) BY a common order passed in respect of all the assessments, the Tribunal has decided the appeals of the assessee by making reference to its earlier decision in ITA Nos. 1353 to 1355(Ahd) and No. 1512 (Ahd) for asst. yrs. 1967 68 to 1970 71 in respect of the same assessee. While the controversy has been mentioned in brief in the Tribunal's order as well as in the orders of the AAC, the facts in the background of which the controversy has arisen has not been stated in the order of the Tribunal for the asst. year 1972 73 to 1977 78. However, the order of the Tribunal relying upon which the order in question has been made has also been made part of the statement of the case from which the following facts emerge. The assessee Kasturbhai Mayabhai is assessed to income tax. From asst. yrs. 1939 40 upto the asst. year 1965 66 he was returning income from all sources in the 'individual' status and was so assessed. Initially returns for 1966 67 to 1970 71 were also filed in his individual status. However, revised returns for these years were filed on 14th Dec., 1970. Two sets of revised returns were filed. One set was in the individual status while the second set was in the status of HUF. The assessee was the natural born son of Manibhai and was adopted by his uncle Mayabhai in the year 1919. Manibhai and Mayabhai have inherited properties from their father Nathubhai Lalbhai. Manibhai and Mayabhai inherited the properties under a will dt. 21st Dec., 1900. Mayabhai inherited 7/16th share; while Manibhai inherited 9/16th share in the properties of said Nathubhai. The properties of both these brothers have been inherited by the assessee. The assessee claimed the status of HUF regarding the income derived from the properties which he inherited from his adoptive father Mayabhai; and claimed his status as 'individual' in respect of income derived from the properties that came to him as successor of Manibhai or reversioner to Manibhai's widow after her death. In respect of all these asst. yrs. 1966 67 to 1970 71 the ITO held that all the properties which the assessee had inherited from his adoptive father Mayabhai as well as Manibhai, the natural father, were properties belonging to the assessee's HUF. He, therefore, assessed the income derived from these properties in the hands of assessee's HUF. However, as a protective measure, he included the income derived from the properties inherited by the assessee from Manibhai (i.e. 9/16th share of Manibhai in Nathu Bhai's property) in the assessee's total income in his individual status. Aggrieved by that part of the order by which 9/16th share relating to the properties inherited from Manibhai were held to be HUF, the assessee carried the matter in appeal before the AAC. The AAC accepted the contention of the assessee and held that the income derived by the assessee from the properties which he inherited from his adoptive father Mayabhai was income belonging to the HUF; while the income derived by him from the properties which he inherited from his natural father Manibhai as his individual income.

(3.) THE Tribunal passed the order on 22nd Dec., 1975. After Tribunal's aforesaid order, assessments for the years in question viz. 1972 73 to 1977 78 came to be passed on different dates which are Annexures H 1 to H 6 annexed in the statement of case. The assessments were made in the status of individual in respect of income derived by the assessee from the properties including the one inherited by him from his adoptive father Mayabhai which accounted for 7/16th of the entire income. The AAC confirmed those assessments following the aforesaid decision of the Tribunal. The Tribunal in its order stated that both the authorities have relied upon the decision dt. 22nd Dec., 1975 of the Tribunal for the asst. yrs. 1967 68 to 1970 71 in ITA Nos. 1353 to 1355 (asst. yr. 1972 73) which was against the assessee and saw no infirmity in the decision of the Tribunal.