2005 (3) TMI 105

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....e Tribunal was justified in holding that the aforesaid section will not apply because assessments were made after December 31, 1978 ?" 2. Briefly stated the facts giving rise to the present case are as follows : The reference relates to the assessment years 1981-82 and 1982-83. The respondent-assessee, a joint Hindu family consisting of a karta, Sri Gian Chand, his wife and four sons. The HUF was a partner in a firm M/s. Ladulal Kewalchand, Shamli, having half-share in the profits and the capital of the firm. 3. A partial oral partition was claimed on October 20, 1979, which was reduced in writing on October 21, 1979, between the members as regards the share income and withdrawal from banks, capital as standing to the credit of the famil....

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....led, the Income-tax Officer cannot refuse the claim of partial partition. It took the view that no assessment was made in the status of the HUF the assessee is out of the reach of section 171(9) of the Act. Further, it took a view that the word "assessed" used in section 171(9) of the Act means passing of the assessment order prior to the date of partial partition. 5. Heard learned standing counsel for the Department and perused the statement of the case and its annexures. None appeared on behalf of the assessee. 6. Section 171 of the Act deals with the assessment after partition of a Hindu undivided family. It is a machinery section. It basically provides two things. Firstly, a Hindu undivided family hitherto assessed as undivided shall ....

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....re completed in October, 1982, i.e., much later from the date of partial partition. The date of partial partition is October 20, 1979. The Tribunal has accepted, as a fact, that no assessment has been made on the joint family as such prior to December 31, 1978. 8. We have given a thoughtful consideration to the reasoning of the Tribunal but find it difficult to agree with the Tribunal. The scheme of section 171 of the Act is that a Hindu undivided family provisionally assessed as Hindu undivided family shall be deemed for the purposes of the Income-tax Act to be the Hindu undivided family unless a partition as claimed by any member of the family is recognized which is within the four corners of the partition as defined in the Act. The Supr....