Partnership income accrues only on a legal right to receive it; HUF not taxed where karta alone was the partner.

Income from a partnership share accrues only when the recipient acquires a legal right to receive it. Here, the karta alone was the partner, while the Hindu undivided family was not itself a partner, and the partnership continued unchanged through the accounting year. Because partnership profits were ascertainable only at year-end and the family had not acquired any direct right to those profits during the year, no part of the calendar year 1955 profits accrued to or was taxable in the hands of the Hindu undivided family.

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Issues: Whether the 5 annas share in the profits of the partnership firm for the relevant year accrued to the Hindu undivided family and was chargeable in its hands.

Analysis: The deed of partition showed that the karta became the full owner of the partnership share only from the date of partition, and the partnership itself continued without any change in constitution throughout the accounting year. In income-tax law, profits of a firm are ascertained with reference to the firm's accounting period, and income does not accrue until the person concerned acquires a right to receive it. The Hindu undivided family was not a partner in the firm; the karta alone was the partner vis-a -vis outsiders, and the profits of the firm for the calendar year could be determined only at the end of that year.

Conclusion: No part of the profits of the firm for the calendar year 1955 accrued to the Hindu undivided family or was taxable in its hands.

Ratio Decidendi: Income from a partnership share accrues only when the assessee acquires a legal right to receive the profits, and where the karta alone is the partner, the Hindu undivided family cannot be charged with such partnership income unless it has itself become the partner or the income has otherwise accrued to it.

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