TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether the Tribunal and the High Court were justified in refusing to refer the question under section 66(2) of the Indian Income-tax Act, 1922 on the ground that the point was concluded by an of the Supreme Court and had become academic. (ii) Whether the sum of Rs. 21,000 received by Mathura Prasad as allowance from the partnership business was the income of the Hindu undivided family or his personal income.
Issue (i): Whether the Tribunal and the High Court were justified in refusing to refer the question under section 66(2) of the Indian Income-tax Act, 1922 on the ground that the point was concluded by an of the Supreme Court and had become academic.
Analysis: The right to seek a reference depends on whether a real question of law arises from the order sought to be challenged. Where the point is already concluded by binding authority of the highest court, the proposed reference serves no useful purpose and may properly be declined as academic. On the facts found, the Tribunal treated the matter as governed by the earlier decision which had laid down the controlling principle.
Conclusion: The refusal to direct a reference was justified and is in favour of the Revenue.
Issue (ii): Whether the sum of Rs. 21,000 received by Mathura Prasad as allowance from the partnership business was the income of the Hindu undivided family or his personal income.
Analysis: The decisive consideration was that the karta entered the partnership and obtained the managerial allowance with the aid of joint family funds. The partnership arrangement linked the allowance to the role assumed in the business and made the withdrawal dependent on the profits of the concern. The receipt was therefore not an isolated personal emolument but arose from the use of family assets in the partnership venture, creating an inseparable connection between the family funds and the remuneration.
Conclusion: The allowance was income of the Hindu undivided family and not the personal income of Mathura Prasad.
Final Conclusion: The binding principle applied to the facts led to the rejection of the claim for reference and to the assessment of the allowance as family income, so the appeal failed in full.
Ratio Decidendi: Where a karta enters a partnership on behalf of the joint family using family funds, remuneration or allowance earned from that arrangement is assessable as the income of the Hindu undivided family if the receipt is directly traceable to the use of those funds and is inseparably connected with the partnership advantage.
TaxTMI 
TaxTMI 
