- (1.) These appeals, by special leave, arises out of a reference made by the Income-tax Appellate Tribunal, Allahabad Bench, (hereinafter referred to as 'the tribunal') under Section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') whereby the following question was referred for the opinion of the Allahabad High Court :- "Whether on the facts and in the circumstances of the case 1/6th income from the computation of income of the assessee - Hindu Undivided Family - could be excluded pertaining to the minor son as Maharaja -
(2.) By the impugned judgment the High Court has answered the said question against the Revenue and in favour of the assessee. The High Court has placed reliance on its earlier decision in M/s. Kalloomal Tapeswari Prasad v. Commissioner of Income-tax, 1973 Tax Law Reports 697. Briefly stated the facts are as follows : Maharaja P. P. Singh of Balrampur was being assessed as an individual up of and including the assessment year 1964-65. He had no issue to his own. On December, 28, 1963, he adopted Maharaja Dharamendra Pratap Singh, who was a minor, as his son. After the aid adoption the status of Maharaja P.P. Singh was taken as that of the Hindu Undivided Family (for short HUF'). Maharaja P.P. Singh died on June 20, 1964. Thereafter his wife, Maharani Raj Laxmi Devi, became the karta of the HUF consisting of herself and the aforesaid minor son. Maharaja Dharmendra Pratap Singh. For the assessment year 1966-67, the assessee filed a return declaring the total income of the HUF as Rs. 28,935/-. Subsequently she filed another return showing the total income as Rupees 25,288/-. The difference between the original and revised returns was explained on the basis that the revised return had been filed by the HUF after excluding 1/6th share belonging to the minor son, Maharaja Dharmendra Pratap Singh, as an individual because according to Section 6 of the Hindu Sucession Act, 1956, 1/3rd share of Late Maharaja P. P. Singh in the HUF property devolved on his two heirs Maharaja Dharmendra Pratap Singh (minor son) and Maharani Raj Laxmi Devi (wife). The Income-tax Officer held that the Act is a separate, distinct and complete statute in itself and under the Act a change in the HUF status can be effected only by claiming partition either partial or complete and that such partition could become operative if a claim of partition has been preferred and after examining the evidence produced, an order under Section 171 accepting the claim of partition has been accepted by the Income-tax Officer, and that in the case of the assessee both the elements were missing. He, therefore, held that the assessee HUF continued to be as it was before. The said view was followed by the Income-tax Officer in the assessments for the subsequent assessment years 1967-68 to 1970-71. The said view of the Income-tax Officer was upheld in appeal by the Appellate Assistant Commissioner. On further appeal the Tribunal reversed the said view and held that the case of the assessee was not of a partition contemplated in Section 171 and, therefore, no claim was necessary and absence of an order under Section 171 does not mean that the whole estate should be deemed to belong to the assessee HUF. The Tribunal, following the decision of the Allahabad High Court in the case of M/s. Kalloomal Tapeswari Prasad, (1973 Tax LR 697) (supra), further held that assuming the assessee's case came under Section 171 the estate of the assessee HUF having been diminished in terms of Section 6 of the Hindu Succession Act, 1956, but with regard to which an order accepting the claim for partial partition has not been made, the income from such property could not be included in the computation of the income of the HUF. The Tribunal referred the question abovementioned to the High Court for its opinion and the said question was answered by the High Court in favour of the assessee and against the revenue. The High Court has followed its decision in the case of M/s. Kalloomal Tapeswari Prasad (supra). Hence this appeal.
(3.) Shri P. A. Choudhary, the learned senior counsel appearing for the Revenue, has argued that the High court was in error in upholding the view of the Tribunal that Section 171 of the Act was not applicable in the present case. Shri Choudhary has pointed out that the decision of the High Court in M/s. Kalloomal Tapeswari Prasad, (1973 Tax LR 697) (supra), on which relance has been placed by the High Court in the impugned judgment has been reversed by this Court in Kalloomal Tapeswari Prasad (HUF) v. Commissioner of Income-tax, Kanpur, (1982) 133 ITR 690 : (AIR 1982 SC 760), and the said decision has been followed in later decision in The Income-tax Officer, Calicut v. Smt. N. K. Sarada Thampatty, (1991) 187 ITR 696 : (1991 AIR SCW 2271) and R. B. Tunki Sah Baidyanath Pd. v. Commissioner of Income-tax, Bihar-I, Patna, (1995) 212 ITR 632 (SC).;