HUF penalty liability continues until partition is formally recognised, despite an earlier private disruption.

A Hindu undivided family continued to be assessed in undivided status until an order recording partition was made under section 25A(1), because section 25A(3) created a legal fiction preserving that status despite a private disruption. The decisive point was not the date of the family partition, but whether recognition of partition had already been ordered when penalty proceedings were initiated and when penalty was imposed. As no such order existed at either stage, the family remained assessable as a HUF and the penalty under section 28(1)(c) was valid.

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Issues: Whether penalty under section 28(1)(c) could validly be imposed on a Hindu undivided family after the family had disrupted, but before an order recognising partition was made under section 25A(1).

Analysis: Section 25A(3) created a legal fiction that a Hindu family hitherto assessed as undivided continued to be treated as a Hindu undivided family until an order recording partition was passed under section 25A(1). The relevant question was therefore not the date of the private partition, but whether an order under section 25A(1) had already been made when penalty proceedings were initiated and when penalty was imposed. As no such order existed at either stage, the family continued to be assessable in the undivided status and the penalty proceedings were not barred.

Conclusion: The imposition of penalty was valid and the question was answered against the assessee.

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