Association of individuals requires common purpose and collective control; mere joint management is not enough.

An association of individuals under section 2(q) of the Madras Agricultural Income-tax Act, 1955 requires persons to have joined for a common purpose or common action, with authority to manage the group's affairs for collective benefit. Mere joint ownership, a common manager, or common accounting arrangements is insufficient without proof of a voluntary common enterprise. On the facts found, the twelve family members did not form such an association, so they could not be assessed as one unit. The Commissioner's view was set aside and the matter remitted for reconsideration.

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Issues: Whether the twelve persons, comprising the two branches of the family and their respective members, constituted an association of individuals within the meaning of section 2(q) of the Madras Agricultural Income-tax Act, 1955, so as to be assessable as one unit.

Analysis: Association of individuals is to be understood in its popular sense. The essential requirement is that the persons concerned must have joined together for a common purpose or common action, with an express grant of authority or circumstances clearly warranting an inference that some among them were authorised to manage the affairs of the group for the common good. Mere joint management of properties, the existence of a common manager, or the fact that accounts were maintained in a common firm does not by itself establish such an association. The decisive test is whether the individuals were knit together by intention and proof of a common enterprise, so that control was voluntarily vested in one or more persons for the collective benefit.

Conclusion: The twelve persons did not constitute an association of individuals on the facts found. The Commissioner's view was set aside and the matter was remitted for reconsideration.

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