TaxTMI 
TaxTMI 
1986 (7) TMI 178
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.... as he wanted to give Rs. 50,000 to his minor son, Master Harnam Singh Dhingra and another sum of Rs. 1 lakh jointly to himself and his wife. The relevant clauses of the said declaration read as below : "1. That I, Sohan Singh Dhingra along with my wife Mrs. Amrit Dhingra and a minor son Master Harnam Singh Dhingra, constitute a HUF. 2. That I am the karta of the said HUF. 3. That the said HUF owns both movable and immovable properties. 4. That the said HUF owns movable property in the shape of capital investments in various partnership concerns and personal books of the said HUF are being maintained. 5. That I of my own free will and volition and with the previous consent of my said wife Mrs. Amrit Dhingra and with the consent of other relatives and well wishers of the family took out a sum of Rs. 1,50,000 out of the capital investment in the personal books of the said HUF, namely, Shri Sohan Singh Dhingra (HUF) and divided it and partitioned it amongst the coparceners of the HUF as under : 6. That a sum of Rs. 50,000 (Rupees fifty thousand only) was allotted to my minor son Master Harnam Singh Dhingra and he is now at liberty to enjoy the fruits thereof in his o....
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....sp; Debit Credit 1-4-1978 By balance brought forward 2,14,016.39 of last year 29-7-1978 To insurance premium paid 508.00 To insurance premium 508.00 30-12-1978 To amount t....
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....bsp; 63,000.39 ----------------------------- ------------------------- ....
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....------------------------------ Rs. Rs. 1979 Last year account 26,824.06 1979 To amount transfer &nb....
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....; To amount transfer fromNew Delhi to account of Shri factory account 1,23,175.94 Sohan Singh Dhingra &n....
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.... the Income-tax Act, 1961 ('the Act'), which in effect provided that a partial partition claim if effected after 31-12-1978 should be ignored for the purpose of assessment to income-tax of the income of the family. 5. The assessee challenged the correctness of the above finding of the ITO before the learned AAC, who accepted the assessee's plea that the books of account of the HUF had been maintained by the assessee in the normal course of his business and, that, therefore, the entries made therein on 30-12-1978 constituted a valid partial partition of the assets of the family to the extent of Rs. 1,50,000. The department challenges the correctness of the above finding of the learned AAC through this appeal. 6. After examining the books of account of the family, which have been maintained by the assessee, and in the absence of any particular instance to show that the same had not been maintained by the family in the normal course of its business, we have no hesitation in confirming the finding of the learned AAC that the said books had been maintained in the normal course of its business and that the entries in the capital account of the family were in fact made on 30-12-1978....
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....ly has not defined the properties which have to be partitioned in a partial partition of the family and it is merely part of the value of the assets of the family in excess of the liabilities of the family, which would be the net wealth of the family that is being sought to be partitioned amongst the family members, it may be a valid partition under the Hindu law, involving severance of status of the members in question, but, for the purposes of the Act, the said partition would not be a valid partition, for the definition of partition, as given in the Explanation to section 171, specifically requires that the properties, which have to be partially partitioned, must be specified and the said properties should be physically partitioned amongst the members in question, and only, if there be some property, which is not capable of physical division, the said property should be divided by some other mode which the property may admit of. In the present case, unfortunately, as on30-12-1978, the family did not indicate the property which was to be divided amongst the members of the family. It merely indicated that out of the capital of the family, which meant the excess of the total value ....