RANGALAL MODI Vs. COMMISSIONER OF INCOME TAX
HIGH COURT OF ORISSA
COMMISSIONER OF INCOME TAX
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JAGANNADHADAS, J. -
(1.) THIS is a reference under the Income -tax Act. This Court by its order dated 3rd January 1949, directed the Income -tax Appellate, Tribunal to state a case under Section 66 (2) of the Act. In pursuance of that
order the question that has been referred for decision of this Court is stated by the Tribunal in the
'Whether on the facts and in the circumstances of the case the Tribunal erred ia law ia holding that the applicant was not entitled to an order under Section 25 -A.'
(2.) TO appreciate the question at issue, the facts and the circumstances of the case as they appear from the records require to be elucidated. They are as follows:
The assesses is one Rangalal Modi of Cuttack. The assessment year is 1944 -45 and the accounting year is Dewali of 1949 to dewali of 1943 which is stated to be from 8th November 1919 to 10th November
1943. Rangalal Modi and his sons constituted a joint Hindu family and were being assessed as such. During the sourse of the assessment in question, the assessee claimed that this joint family had become
distrupted on 9th November 1949 and subsequently as evidenced by a partition, deed dated 96th October
1943, that is, during the course of the accounting year and that accordingly he is entitled to an order under Section 25 -A of the Act and for assessment accordingly. The Income tax authorities have held that he was
not so entitled and hence this reference.
(3.) ONE Hariram was the father of Rangalal. The original joint family consisting of Hariram and bis sons including Rangalal appears to have saperated some years previously, i.e., in or about 1934, and we are not
directly concerned with the same. After the disruption of the original joint family, Rangalal with his sons
constituted s joint family and it is with the alleged disruption thereof we are at present concerned, This
family owned or had interest ia properties described in Sohs. A to E of the registered partition -deed dated
25th October 1943. They consist of lands, buildings and mills. It would appear that one of the sons of Rangalal by name Manalal had brought a suit for partition and got his share in the family property by a
decree dated 10th August 1942. The present partition is therefore concerned with the remaining properties
of the joint family and is between Rangalal and his three other sons, Basudev, Kanhailal and Chaturbhuj.
The partition -deed recites that on 9th November 1942, that is, the day following the Dewali, in 1942, the
parties namely, Rangalal and his three sons had divided all business in four equal shares and that since
then they were carrying on business in four equal shares and that since then they were carrying on
business in partnership, with defined shares and on terms specified in separate deeds of partition executed
by the said parties. It also recites that the parties had divided ornaments, utensils, etc., amicably as
between themselves and that since 9th November 1942, they were completely separated in interest, mess
and property, from each other and that each of the parties is separately dealing with their respective
properties and separately managing their respective families. The partition -deed accordingly deals with
only immovable property of the family and it recites that parties 1 to 4 have amicably divided the same,
some by metes and bounds and some by ascertainment of definite shares as set forth in the Schedules. A
reference to the schedules shows that the properties in Schedule (A) were alloted to party No. 1 namely,
Bangalal, those in Schedule (B) to party no. 2, Basudev Praead, Schedule (c) to party No. 3, Kanhailal
and in Schedule (D) to party no. 4 Chaturbhuj. Properties in Schedule (E) however were not partitioned
by metes and bounds and it is stated in the partition -deed para. 6 as follows:
'We the parties one to four shall own and possess the same with defined shares of four annas each and we will get them partitioned by metes and bound in future whenever we or any of us parties 1 to 4 deem it convenient and possible and the parties 1 to 4 each remains liable for payment of rent, tax and other charges (one fourth each) with effect from 9th November 1942.' ;
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