Tax assessment fiction cannot create a Hindu undivided family after partition; notices against the manager lacked jurisdiction.

Section 29 of the Agricultural Income-tax Act, 1950 was discussed as a machinery provision for assessment after partition, not as a source of fresh tax liability where a Hindu undivided family had already been partitioned by metes and bounds before the relevant accounting year. The majority view recorded that the statutory fiction in section 29(3) could not be extended to create a taxable Hindu undivided family in circumstances where none existed, and that notices issued against the petitioner as manager were without jurisdiction. A dissenting opinion stated that section 29 could continue to treat the family as a Hindu undivided family until partition was recognised under the section.

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Issues: Whether the notices issued to proceed against the petitioner as manager of a Hindu undivided family for the assessment year 1961-62 were valid, and whether section 29 of the Agricultural Income-tax Act, 1950, as amended, could be invoked where the family had already partitioned and no Hindu undivided family existed in the relevant accounting year.

Analysis: The charging provision fastened liability on the person who received agricultural income during the previous year, and section 29 was only a machinery provision dealing with assessment after partition. The family had partitioned by metes and bounds before the relevant accounting year, and the petitioner had ceased to be manager. The legal fiction in section 29(3) was held to be limited to cases where assessment proceedings under section 18 could properly be initiated against a Hindu undivided family and could not be extended to create, for the first time, a taxable Hindu undivided family where none existed in the accounting year. The majority also held that the earlier assessments or proceedings did not bar the present challenge in a manner that would validate the impugned notices.

Conclusion: The impugned notices were without jurisdiction and could not sustain proceedings against the petitioner as manager of a Hindu undivided family.

Concurring Opinion: No separate concurring opinion was recorded.

Dissenting Opinion: Mathew J. held that section 29, as amended, could validly treat the family as a Hindu undivided family for the purpose of assessment until partition was recognised under the section, and would have dismissed the petition.

Ratio Decidendi: A statutory fiction in a machinery provision cannot be extended beyond its limited purpose to deem into existence, for tax assessment, a Hindu undivided family that had already ceased to exist in the relevant accounting year.

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