Taxability of joint loan interest turns on proof of genuine income division and actual assessment in others' hands.

The entire interest credited in a joint loan account was taxable in the assessee's hands because the claimed one-third allocation was unsupported by evidence of any entitlement of the other two persons or proof that the income had been assessed in their hands. In the absence of material showing a genuine division of income, the income was presumed to have accrued to the assessee. The mercantile system of accounting also supported assessment of the full interest in the assessee's hands. The plea of impermissible double taxation therefore failed, and inclusion of the entire interest in the assessment was upheld.

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Issues: Whether the entire interest credited in the joint loan account was taxable in the assessee's hands, and whether the assessment amounted to impermissible double taxation.

Analysis: The assessee's claim that only one-third of the interest could be brought to tax depended on proof that the other two persons had a real entitlement to the income and that the interest had in fact been assessed in their hands. The findings of the Income-tax Officer, affirmed in appeal, were that the entire sum belonged to the assessee, that the alleged joint liability lacked supporting evidence, and that there was no material showing that the other two persons were entitled to one-third each of the interest. In the absence of evidence establishing a genuine division of income, the presumption was that the income accrued to the assessee. The mercantile system of accounting also supported assessment in the assessee's hands.

Conclusion: The inclusion of the entire interest in the assessee's assessment was valid, and the plea of double taxation failed.

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