SHEO NARAIN DULI CHAND Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE Income-tax Appellate Tribunal, Allahabad, has referred the following question to this court:

(2.) MESSRS. Sheo Narain Dalichand is the assessee. This is a Hindu undivided family. The year of assessment is 1956-57. The accounting period was the financial year ending on 31st March, 1956. The assessee submitted a return on the footing that there had been a partial partition in the family on 17th August, 1955. Under the partial partition, retail business and halwai business were taken over by two branches of the family. The wholesale businees of the family was taken over by a firm consisting of four partners, Sheo Narain, Jagram, Hargovind and Pragdas. These four persons were sons of Dulichand deceased. A deed of agreement was drawn up on 20th August, 1955, embodying the terms of the partial partition dated 17th August, 1955. A deed of partnership was prepared on 16th July, 1956. The assessee, therefore, urged that the wholesale business carried on by the firm after 17th August, 1955, could not be treated as the business of the assessee family. This contention of the assessee was not accepted by the Income-tax Officer. He rejected the assessee's case of partial partition. Assessment was made on the footing that there had been no partial partition as alleged. Successive appeals of the assessee were dismissed by the Appellate Assistant Commissioner and by the Income-tax Appellate Tribunal, Allahabad. At the instance of the assessee, the Tribunal has referred to this court the question quoted above.

(3.) WE proceed to answer the question as reframed by us.