1981 (8) TMI 117 - AT - Income Tax

Assessment of HUF Income post-karta's demise: ITAT clarifies coparcenary share, mother-son income distribution

The Appellate Tribunal ITAT Hyderabad-B addressed the assessment of income in a Hindu Undivided Family (HUF) following the demise of the karta and a claim ... Hindu Undivided Family, Assessment After Partition Issues:Assessment of income based on alleged partition in Hindu Undivided Family (HUF) for the assessment year 1977-78.Analysis:The judgment by the Appellate Tribunal ITAT Hyderabad-B revolves around the assessment of income for the assessment year 1977-78 based on an alleged partition in a Hindu Undivided Family (HUF). The case involves a HUF with Jookanti Viswanadham as the karta, comprising his son J. Ramulu, Viswanadham's wife Rajeswaramma, Ramulu's wife Vijayalakshmi, and their minor daughters. Viswanadham passed away on 20-5-1975, leading to a claim of partition by Ramulu and his mother. The Income Tax Officer (ITO) assessed the income, rejecting the claim of partition, leading to an appeal by the assessee to the Appellate Authority. The Appellate Authority upheld the ITO's decision, stating that there could be no partition between the son and mother due to the absence of coparceners other than Ramulu. The Appellate Tribunal, upon hearing the arguments, delved into the legal aspects, citing the Supreme Court's decision in Gurupad Khandappa Magdum v. Hirabai Khandappa Magdum [1981] 129 ITR 440 regarding the Hindu Succession Act. The Tribunal concluded that Ramulu would have a half share in the coparcenary property of Viswanadham, necessitating a proper assessment based on the devolution of assets. The Tribunal directed a fresh assessment, considering the legal provisions and the status of the parties involved. The judgment clarified the distribution of income between Ramulu and his mother as tenants-in-common, setting aside the previous assessment and ordering a new assessment in accordance with its directions.In summary, the judgment addresses the dispute over the assessment of income in a HUF following the demise of the karta and the subsequent claim of partition. It provides a detailed analysis of the legal principles under the Hindu Succession Act and determines the proper distribution of assets and income among the family members involved. The Tribunal's decision emphasizes the necessity of a correct assessment based on legal provisions and sets aside the previous assessment for a fresh evaluation in compliance with the directions outlined in the judgment.