Coparcener's director remuneration treated as individual income where receipts were linked to personal services, not family investment.

Remuneration, bonus and sitting fees received by a coparcener as a director were assessed by their real character: if the receipt was a return on the Hindu undivided family's investment, it would belong to the family, but if it was compensation for personal services, it would be the coparcener's individual income. On the facts, the company was not promoted by the assessee, the family held only a minority stake, and the directorship was obtained because of the assessee's own experience and qualifications in the cotton business. The receipts were therefore treated as individual income, not HUF income.

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Issues: Whether remuneration, bonus, and sitting fees received by a coparcener as director of a company constituted the income of the Hindu undivided family or his individual income.

Analysis: The governing test was whether the receipt was, in substance though not in form, a return on the family's investment in the business, or whether it was compensation for services rendered by the individual coparcener. The facts found showed that the company was not promoted by the assessee, the family held only a minority shareholding, the assessee had acquired directorship because of his own experience and qualifications in the cotton business, and there was no detriment to the family's investment. The remuneration was therefore linked to his personal services and not to the family's funds or assets.

Conclusion: The remuneration, bonus, and sitting fees were the individual income of the coparcener and not the income of the Hindu undivided family.

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