Proviso to Section 64(2): income already assessed in an individual's hands cannot be taxed again in the HUF.

Income that has already been finally assessed as an individual's income cannot be brought again into the Hindu undivided family's assessment under the proviso to Section 64(2) of the Income-tax Act, 1961. The provision requires exclusion of such income from the family's total income once it has been included in the individual's total income. On that basis, interest income and share income previously assessed in the assessee's individual hands were not liable to taxation in the HUF's assessment.

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Issues: Whether interest income and share income already assessed in the hands of the individual assessee could still be included in the assessment of the Hindu undivided family in view of the proviso to Section 64(2) of the Income-tax Act, 1961.

Analysis: The income from the deposit and partnership had already been finally assessed as the individual income of the assessee. Once a particular income is included in the total income of an individual, the proviso to Section 64(2) requires that it be excluded from the total income of the family and cannot again be taxed in the hands of the Hindu undivided family.

Conclusion: The question was answered in the affirmative, in favour of the assessee and against the Revenue.

Ratio Decidendi: Income that has been finally included in the total income of an individual cannot again be assessed in the hands of the Hindu undivided family by virtue of the proviso to Section 64(2) of the Income-tax Act, 1961.

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