Total income includes deemed income under section 64 for house property relief, but differs from gross total income.

For the proviso to section 23(2) of the Income-tax Act, "total income of the owner" is read in the sense of section 2(45) and includes income assessable in the owner's hands under section 64; the proviso contains no exclusion for such deemed income, so the issue was answered against the assessee. Total income under section 5 is not equivalent to "gross total income" under section 80B(5), because gross total income is a separately defined concept computed before Chapter VI-A deductions and without applying section 64; this issue was answered in favour of the assessee.

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Issues: (i) Whether, for the purpose of the proviso to section 23(2) of the Income-tax Act, 1961, the "total income of the owner" includes income assessable in the assessee's hands under section 64. (ii) Whether "total income" under section 5 of the Income-tax Act, 1961 is equivalent to "gross total income" as defined in section 80B(5) of the Act.

Issue (i): Whether, for the purpose of the proviso to section 23(2) of the Income-tax Act, 1961, the "total income of the owner" includes income assessable in the assessee's hands under section 64.

Analysis: The relief under section 23(2) is confined to an individual owner occupying the house for his own residence. The expression "total income" in the proviso is to be understood in the sense given by section 2(45), namely, the total amount of income computed in the manner laid down in the Act. That computation necessarily attracts section 64, under which income of a minor child or spouse is included in the individual's hands. The proviso does not carve out any exclusion for such deemed income, and the specific exclusion found in section 80B(5) shows that where the Legislature intended exclusion under section 64, it said so expressly.

Conclusion: The total income of the owner under section 23(2) includes income assessable under section 64, and the answer is in the affirmative, against the assessee.

Issue (ii): Whether "total income" under section 5 of the Income-tax Act, 1961 is equivalent to "gross total income" as defined in section 80B(5) of the Act.

Analysis: Section 5, read with section 2(45), defines total income as income computed under the Act subject to the exclusions and inclusions provided by the statute. Gross total income under section 80B(5) is a different concept, specifically defined as total income computed before Chapter VI-A deductions and without applying section 64. The two expressions are therefore not interchangeable, and the statutory scheme treats them as distinct concepts.

Conclusion: Total income under section 5 is not the same as gross total income under section 80B(5), and the answer is in the negative, in favour of the assessee.

Final Conclusion: The reference was answered partly against the assessee and partly in his favour, with no order as to costs.

Ratio Decidendi: For computation under section 23(2), "total income" takes its meaning from section 2(45) and includes income deemed to be the assessee's under section 64, but it remains distinct from the separately defined concept of "gross total income" under section 80B(5).

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