1970 (8) TMI 7

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....indu undivided family. Prem Nath, the manager of the family, was admitted as representing the family to a partnership styled "M/s. K. C. Raj & Company". Under the terms of the partnership Prem Nath was entitled to an "allowance of Rs. 700 per month" for "rendering service" to the partnership. In proceedings for assessment of income-tax of the Hindu undivided family, the Income-tax Officer rejected....

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....appealed to this court. Prem Nath was "a working partner" and he was allowed a salary at the rate of Rs. 700 per month. There is no evidence on the record that the remuneration agreed to be paid was not for services rendered to the partnership. It is true that, in the partnership, Prem Nath represented his undivided family. The share in the profits of the partnership may on that account be rega....

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....urt held that the remuneration received by the karta was not the income of the Hindu undivided family. In reaching that conclusion this court relied upon the judgment in V. D. Dhanwatey v. Commissioner of Income-tax, wherein it was observed that remuneration paid to a member of a Hindu undivided family, who represents the family in a partnership, will be treated as the income of the family if it i....

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....nd the remuneration received by the manager as the managing partner of the two firms was not assessable as the income of the Hindu undivided family. This court in Raj Kumar Singh Hukam Chandji v. Commissioner of income-tax, after a review of the decisions, observed: "......... the broader principle that emerges is whether the remuneration received by the coparcener in substance though not in....