Hotch-pot contribution and family partition do not create an indirect transfer to wife or minor child under clubbing rules.

Property voluntarily thrown by a coparcener into the Hindu joint family hotch-pot becomes joint family property, and a later partition among family members remains a separate and genuine transaction. On that footing, a transfer to a Hindu undivided family is only a transfer to an assessable unit and does not, by itself, amount to an indirect transfer to the transferor's wife or minor son under section 16(3)(a)(iii) or section 16(3)(a)(iv) of the Indian Income-tax Act, 1922. The income attributed to the family could not be clubbed in the transferor's hands under those clauses, because no direct or indirect transfer to the wife or minor child was disclosed.

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Issues: Whether the throwing into the hotch-pot of the assessee's self-acquired property and the subsequent partition among the members of the Hindu undivided family constituted an indirect transfer of property to the wife and minor son within the meaning of section 16(3)(a)(iii) and section 16(3)(a)(iv) of the Indian Income-tax Act, 1922.

Analysis: Property voluntarily thrown by a coparcener into the common hotch-pot becomes joint family property under Hindu law, and the separate and subsequent partition transactions are genuine and independent. A transfer to a Hindu undivided family is a transfer to an assessable unit, but income arising to that family cannot, on that footing alone, be treated as income arising to the wife or minor child of the transferor within section 16(3)(a). The provision dealing with income of a person, including a Hindu undivided family, from transferred assets is separately dealt with in section 16(3)(b), and the facts did not disclose any direct or indirect transfer by the assessee to his wife or minor son.

Conclusion: The transaction did not amount to an indirect transfer to the wife or minor son within section 16(3)(a)(iii) or section 16(3)(a)(iv); the answer was in the negative and the assessee succeeded.

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