TaxTMI 
TaxTMI 
1981 (2) TMI 11
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....9, consisted of four members, namely, Vimalbhai Nagindas, the karta, his wife, Taramati, and his two sons, Gautambhai and Vikram. This joint Hindu family was the owner of a property situated in Saraspur in Ahmedabad city. It was a residential house and it bore two survey numbers 2407 and 2409. Survey No. 2407 consisted of 90 square yards and survey No. 2409 consisted of 109 square yards. The propositus for the purposes of this reference may be stated to be one Nagindas and Nagindas had three sons, Chinubhai, Anubhai and Vimalbhai. A partition had taken place on March 6, 1937, and as a result of that partition amongst the members of the HUF consisting of the three sons of Nagindas, the property at Saraspur came to Vimalbhai's share and Vimalbhai's share in the ancestral property bid become the property of the HUF consisting of Vimalbhai, his wife and his two sons. On December 12, 1967, Vimalbhai, in his capacity as the karta of the HUF, that is, the assessee before us, agreed to sell the Saraspur property to one Arvind Nathalal and the agreed sale price was Rs. 80,000. On June 5, 1969, a deed of partial partition was executed and the parties to the deed of partial partition were Vim....
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....nce the property was already the subject-matter of sale by the HUF, and it accepted part payment, the balance to be paid in instalments, the property ceased to be that of the HUF having been already sold. The assessee went in appeal but the AAC upheld the order of the ITO. The assessee carried the matter in appeal before the Tribunal on this point. The question of partition claimed by the assessee in respect of the HUF property assumed importance in the context of the assessment to capital gains in respect of the sale made in favour of Arvind Nathalal. Before the Tribunal the assessee contended that since the property was sold after the partition between the members of the HUF, in respect of this property, capital gains, if any, was taxable in the respective individual's hands or in the hands of the group consisting of Vimalbhai, Taramati and Gautam and not in the assessment of the assessee-HUF which as we have already pointed out above, consisted of four persons, namely, Vimalbhai, Taramati, Gautam and Vikram. The Tribunal held that there was no partition between all the members of the family in respect of this property as contended by the representative for the assessee before th....
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....ng the one-fourth part, went to Vikram and Vikram was to be given a sum of Rs. 20,000 by the group of persons consisting of Vimalbhai, Taramati and Gautam because that was the cash equivalent of Vikram's one-fourth share in the Saraspur property. Then the deed proceeds : " On deducting the said amount, the three persons of the party of the first part have as their joint shares, I part of share in title of the property, Rs. 60,000 (in words rupees sixty thousand) and in that manner, the party of the second part, having got this day from the party of the first part Rs. 20,000 (in words rupees twenty thousand) in cash equal to his share in title of I part in the property has given up all manner of share in title of his part of the said building in favour of the party of the first part making them exclusive owners of the said property. And the party of the second part has handed over possession of the said building to the party of the first part. Since this partial partition deed is executed in the interest of the party of the second part, no claim in title, shire in title or self interest, etc., of any nature of the party of the second part or of his legal heirs and successors and ....
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.... which evinces an intention to sever the joint family; it may also be effected by agreement to divide the property. But in each case the conduct must evidence unequivocally an intention to sever the joint family status. Merely because one member of a family severs his relation, there is no presumption that there is severance between the other members; the question whether there is severance between the other members is one of fact to be determined on a review of all the attendant circumstances. Where there is severance between different branches of a joint family, severance between the members of the branches inter se may not in absence of expression of an unequivocal intention be inferred. It is from the intention to sever followed by conduct which seeks to effectuate that intention that partition results; mere specification of shares without intention to sever does not result in partition."(Emphasis supplied by us). In the instant case, we find that there is an agreement to partition with respect to shares in the Saraspur property by Vikram, on the one hand, and the other group consisting of Vimalbhai, Taramati and Gautam, on the other. Qua the Saraspur property, therefore,....
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....953-34 and made assessments on Tanumati, Udayan, Kirtidev and Achyut in the status of HUF. On these facts the Supreme Court held that Tanumati, Udayan, Kirtidev and Achyat constituted a group and between them and Chinubhai there was partition in definite portions. The order passed by the ITO, Bombay, under s. 25A(1) was a valid order which he was competent to make. Thereafter, the original HUF had no existence in fact or in point of law, personal or income-tax, and it was not open to the ITO, Ahmedabad, to ignore the order either for the year in which the partition of the joint family was recorded or for any subsequent year and to assess the income in the hands of Tanumati, Udayan, Kirtidev and Achyut as if the original HUF continued to exist. It was further held that though the property allotted to the group consisting of Tanumati, Udayan, Kirtidev and Achyut had not been divided by metes and bounds between them, those four persons could still not be assessed as members of an HUF because such a relationship did not exist between them after severance of the joint family status of the family of which Chinubhai was the karta. It was pointed out by the Supreme Court that a complete pa....
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....d that there was a partial partition of the business between the mother and the minor son, and thereafter they became partners in the said business. In connection with these facts, the Division Bench observed at p. 806: " It is equally clear that the larger Hindu undivided family consisting of Shantikumar, Gautamkumar, Bhadrakumar and Kalavati continued to exist and continued to hold properties other than the joint family business of Bipinchandra Gautamkumar after November 10, 1956, on which date Gautamkumar had released his share in the Hindu undivided family business. Therefore, there were two separate assessable entities with effect from November 10, 1956. There was one assessable entity, namely, the joint Hindu undivided family of Shantikumar, Kalavati and Bhadrakumar, carrying on the business in the name of Bipinchandra Gautamkumar. Another assessable entity was the joint Hindu family called Shantikumar Jagabhai Hindu undivided family which owned all properties as prior to November 10, 1956, except the joint family business of Bipinchandra Gautamkumar. These two separate entities must be borne in mind in order to appreciate the correct legal position." In the case before....