Individual property after partial partition remains taxable as individual income despite later family changes.

Property received on partial partition by a person who had no other family member was treated as individual property for income-tax purposes, because the partition brought about a complete disruption of the Hindu family tie in respect of that property. The Tribunal held that later marriage and the birth of daughters did not revive the HUF character or alter the tax status of the property. Income from the partnership firm was therefore assessable in the assessee's hands as an individual, not as a Hindu undivided family, since tax status depends on the actual legal character of the property and not on future family potentiality.

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Issues: Whether the share income from the partnership firm, arising from property received on partial partition, was assessable in the hands of the assessee as an individual or in the hands of a Hindu undivided family.

Analysis: The assessee had obtained the property on partial partition at a time when he had no other family member. The Tribunal held that a partial partition in such circumstances brought about a complete disruption of the Hindu family tie in respect of the partitioned property, and the property became assessable as individual property. Subsequent marriage and the birth of daughters did not restore the HUF character for income-tax purposes. The Tribunal rejected the argument that the character of the property continued as HUF property merely because of later changes in family composition, and followed the view that status under the Income-tax Act must be determined by the actual legal character of the property and not by potentiality or possibility.

Conclusion: The share income was rightly assessable in the hands of the assessee as an individual and not as HUF.

Ratio Decidendi: For income-tax purposes, property obtained on partial partition by a person having no other family member becomes individual property, and later marriage or birth of female children does not by itself revive HUF status in respect of that property.

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