Coparcener remuneration turns on real source and purpose: personal service income is individual income, not HUF income.

Remuneration and sitting fees received by a coparcener are characterised by their real source and purpose: where the receipt is substantially attributable to family funds invested in the business, it is treated as Hindu undivided family income, but where it is genuinely paid for personal services, it remains the coparcener's individual income. Incidental service or the fact that the opportunity arose through family connection or qualification shares does not change the character of a payment that is, in substance, consideration for individual service. On the stated facts, the remuneration and sitting fees were treated as the coparcener's individual income, not HUF income.

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Issues: Whether remuneration and sitting fees received by a coparcener from companies were assessable as income of the Hindu undivided family or as the individual income of the coparcener.

Analysis: The governing test is whether the receipt, in substance, represents a return on the investment of family funds in the business or whether it is compensation for services rendered by the individual coparcener. If the income is earned essentially because of the family investment, incidental service by the coparcener does not alter its character. If, on the other hand, the payment is genuinely for personal services, the fact that the opportunity arose because of family connection or family-held qualification shares does not make the receipt family income.

Conclusion: The remuneration and sitting fees were held to be the assessee's individual income and not income of the Hindu undivided family.

Ratio Decidendi: The character of remuneration received by a coparcener depends on its real source and purpose: if it is substantially a return attributable to family funds, it is HUF income, but if it is payment for personal services, it is taxable as the coparcener's individual income.

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