Ancestral property character in the son's hands favoured HUF taxation over individual assessment.

Property inherited by a son from his deceased father was treated as ancestral property where the son had already constituted a Hindu undivided family and was a coparcener or Karta. Faced with conflicting judicial views on whether the father's self-acquired property changes character in the son's hands, the view favourable to the assessee was preferred. As a result, the property was regarded as belonging to the Hindu undivided family, and the income from it was assessable in the hands of the HUF rather than in the son's individual capacity.

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Issues: Whether the property inherited by the assessee from his father was assessable as the property of the Hindu undivided family or as the individual property of the assessee.

Analysis: The property had been acquired by the assessee from his deceased father, and the assessee had constituted a Hindu undivided family at the time of the father's death. There were conflicting judicial views on whether the self-acquired property of the deceased father would take the character of ancestral property in the hands of the son when he was a coparcener or Karta of a Hindu undivided family. In the presence of such conflict, the view favourable to the assessee was preferred. The property was treated as ancestral in the hands of the son and, therefore, as belonging to the Hindu undivided family.

Conclusion: The property income was assessable in the hands of the Hindu undivided family and not in the individual hands of the assessee.

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