Satish Chandra, J. - (1.) A Hindu undivided family consisted of Bajrang Lal, his wife, four sons, one daughter and mother. This Hindu undivided family owned various assets. On the first day of the previous year relevant to the assessment year 1959-60, there was a partial partition in this family. The business assets of the firm, Phool Chand Bajrang Lal, were partitioned. The assets of this firm were divided equally between Bajrang Lal, his four sons and his wife. The firm was converted into a partnership firm in which the wife did not join as a partner. Thereafter the only partners were Bajrang Lal and his two major sons, the two minor sons were admitted to the benefits of the partnership. With regard to the rest of the assets, the original Hindu undivided family continued.
(2.) IN his individual assessment, Bajrang Lal claimed that the share which he received on partition was liable to be assessed in his hands in the status of a Hindu undivided family consisting of himself, his widowed mother and unmarried daughter. The INcome-tax Officer, however, held that Bajrang Lal was liable to be assessed in the status of an individual. This view was affirmed on appeal. Bajrang Lal, the assessee, took the dispute to the Tribunal. The Tribunal held that in view of the Supreme Court decision in Gowli Buddanna's case [1966] 60 ITR 293 (SC) the position is that if a sole coparcener has received an ancestral property on partition or otherwise, he is entitled to the status of a Hindu undivided family provided he or she represents a family as understood under the personal law of Hindus and is capable, in nature or in law, to add a coparcener to the family, who will be entitled to claim partition. The Tribunal went on to hold that the first condition is admittedly satisfied. Bajrang Lal with his widowed mother and unmarried daughter constituted a family as understood under the personal law of Hindus. The Tribunal then adverted to the other question, whether any member of this family had the capacity in law or in nature to add another male coparcener to the family. The Tribunal held: "In spite of our asking we have not been told the respective ages of the assessee, his wife and the minors so as to judge whether or not the assessee was capable to add in nature a coparcener to the family. We have, therefore, to proceed on the basis that during the material period the assessee's youngest issue was the unmarried daughter aged 13." The Tribunal held that the unmarried daughter as well as his widowed mother were incapable of adding a male member to the family. The Tribunal further held that since Bajrang Lal had sons in existence, he was incapable of adding a male coparcener to the family by adoption. It held that on the facts of the case the normal presumption would be that the family as claimed had no potentiality to add a coparcener. The Tribunal observed that if they had been persuaded to accept that the family was capable to add a member to the family, they would have allowed the assessee's appeals. On this view it was held that the assessee cannot be given the status of a Hindu undivided family. At the instance of the assessee the Tribunal has referred to this court the following questions: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was not entitled to the status of Hindu undivided family for the assessment years 1959-60 and 1960-61? 2. If the answer to the first question is in the affirmative whether, on the facts and in the circumstances of the case, the interest earned by the assessee's minor sons from the firm in which they were admitted to the benefits of partnership and the assessee was a partner, was also liable to be included along with their share of income in the computation of the assessee's income?"
(3.) AT the instance of the assessee this court directed the Tribunal to refer the following questions also for the opinion of this court: "1. Whether the Tribunal was right in holding that before the status of Hindu undivided family could be accorded to the applicant it was necessary for the applicant to prove that he was capable of adding new coparceners to the family in nature or by law ? 2. Whether, on the facts and circumstances of the case, there was any material for the finding that the applicant was incapable of adding a new coparcener to the family ?" We have thus four questions to answer.;