1983 (8) TMI 47

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....e legal formulation are as follows: The assessee-HUF had an old house. That house was sold and a new house was constructed within two years thereof. The assessee claimed exemption of capital gains amounting to Rs. 11,250 under s. 54(1) of the Act. The ITO found that the house which was sold was not used by the assessee or his parents for residence, but it was let out. He accordingly did not allow exemption under s. 54(1) of the Act. The assessee appealed to the AAC. It was urged in that appeal that the house which was sold was under the self-occupation of the assessee and not let out to any third person. The appellate authority accepted that contention and directed the ITO to grant exemption under s. 54(1) of the Act. The Revenue appeale....

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....ove observations that the words used in s. 54 "being used by the assessee or a parent of his mainly for the purpose of his own or the parent's own residence " must relate to the residence of an individual or his parents. The reference to the word " parent " must necessarily relate to the assessee who is an individual and not a statutory person or a juridical person. Mr. Sarangan for the assessee does not, and indeed could not, dispute the above proposition. He, however, submitted that the HUF, which is an assessee in the instant case, was the owner of the house in question and the HUF was in occupation of that house like any other individual. The concept of an HUF under the I.T. Act is not quite different from the concept of an HUF under....

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....e entity. The assessee, when thought of in connection with the parent, can only be an individual. We cannot think of an HUF with a parent. The word parent " is totally inappropriate in the case of an HUF. In CIT v. Sodra Devi [1957] 32 ITR 615, the Supreme Court had an occasion to consider the scope of s. 16(3)(a) of the 1922 Act, which is in the following terms: " 16. (3) In computing the total income of any individual for the purpose of assessment, there shall be included (a) so much of the income of a wife or minor child of such individual as arises directly or indirectly- . ........ The crux of the question debated before the Supreme Court in that case was whether the words " such individual " used in the opening part of s. ....