Clubbing of income from property bought in a minor child's name upheld where the assessee funded the purchase.

Where an assessee funded the purchase of an estate in the name of a minor child, without the child having an independent source of income or adequate consideration, section 9(2) of the Agricultural Income-tax Act, 1950 applied to club the income from the asset in the assessee's assessment. The concurrent factual findings that the assessee was the real source of consideration were decisive, and the income was held includible in the assessee's agricultural income. The Tribunal was also justified in preferring the registered sale deed over a contrary certificate, because the deed and surrounding evidence consistently supported the Revenue's version.

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Issues: (i) Whether the purchase of the estate in the name of the assessee's minor child attracted the clubbing provision and the resulting income was includible in the assessee's income; (ii) Whether the Tribunal was justified in preferring the registered sale deed over the certificate relied on by the assessee to prove repayment of the alleged loan.

Issue (i): Whether the purchase of the estate in the name of the assessee's minor child attracted the clubbing provision and the resulting income was includible in the assessee's income.

Analysis: The findings of the assessing authority, the appellate authority, and the Tribunal consistently showed that the consideration for the purchase flowed from the assessee, that the minor child had no independent source of income, and that the transaction was effected for the benefit of the minor child without adequate consideration. On those concurrent findings, the statutory language of section 9(2) of the Agricultural Income-tax Act, 1950, applied directly to include the income from the transferred asset in the assessee's assessment.

Conclusion: The issue was answered against the assessee and in favour of the Revenue.

Issue (ii): Whether the Tribunal was justified in preferring the registered sale deed over the certificate relied on by the assessee to prove repayment of the alleged loan.

Analysis: The registered sale deed expressly showed that the father, who was the assessee, executed the purchase, whereas the certificate relied on to support a different version did not displace the consistent documentary and factual findings that the assessee was the real source of the consideration. The Tribunal was therefore justified in treating the sale deed as having greater evidentiary value.

Conclusion: The issue was answered against the assessee and in favour of the Revenue.

Final Conclusion: The questions referred were answered in the Revenue's favour, and the income from the estate purchased in the minor child's name was held includible in the assessee's agricultural income.

Ratio Decidendi: Where an individual directly or indirectly transfers assets to a minor child for no adequate consideration, the income from such asset is includible in the transferor's assessment, and a registered conveyance may be preferred over a contrary certificate when the surrounding facts consistently establish the assessee as the real purchaser.

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