Taxable ownership requires evidence: suspicion and family connection alone could not justify treating minors' firm income as the assessee's income.

Suspicion arising from family connections, young age of the minors, unequal profit shares and financing arrangements was insufficient to treat the minors' shares in the second firm as the assessee's income. The record did not show that the assessee participated in the business of the second firm or that the minors were mere nominees for him, and the affidavits and books did not establish taxable ownership in his hands. Section 16(3) applied only where the assessee was a partner in the firm concerned, which he was not in the second firm. The inclusion of the minors' income in the assessee's total income was therefore unsupported by evidence.

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Issues: Whether there was evidence to support the finding that the shares of the assessee's minor sons in the profits of the second firm were really the assessee's income and could be included in his total income.

Analysis: The surrounding circumstances created suspicion, including the minors' large profit shares, their young ages, the absence of capital contribution by one minor, the common family connection between the firms, and financing by the first firm. But suspicion, however strong, was not enough to sustain the inference that the minors were mere nominees of the assessee. The record showed no participation by the assessee in the business of the second firm, and the affidavits and books, even if not wholly conclusive, did not amount to evidence establishing that the assessee was a partner in that firm or that the minors' income was ly his own. Section 16(3) of the Income-tax Act applied only where the assessee was a partner in the firm concerned, which he was not in the second firm.

Conclusion: The finding that the minors' income from the second firm was includible in the assessee's income was unsupported by evidence, and the question was answered in the negative, in favour of the assessee.

Ratio Decidendi: A finding of taxable ownership or nominee status must rest on evidence, and mere suspicion or close association between firms is insufficient to justify inclusion of income in the assessee's total income.

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