TaxTMI 
TaxTMI 
2009 (1) TMI 263
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....the Hindu Undivided Family, the property in question was sold, and the proceeds thereof were invested as Fixed Deposit Receipts in the name of the appellant-assessee i.e. in the capacity of the appellant as a Hindu Undivided Family. The Fixed Deposit Receipts eventually matured on 8.09.1996, whereafter, monetary shares were allegedly apportioned amongst the members of the appellant-assessee i.e. the members of the Hindu Undivided Family. The facts narrated herein are undisputed and are in fact acknowledged by the learned counsel for the rival parties. 3. The question which arises for consideration at the hands of this Court, while disposing of the present appeal relates to the Assessment Year 1997-1998. The appellant-assessee as a Hindu Undivided Family maintains that no assessment can be made for the Assessment Year in question. It is the submission of the learned counsel for the appellant that the original property in the hands of the Hindu Undivided Family, after partial partition thereof on 30.04.1978 could not be assessed to tax under Section 171 of the Act. It is the alternative contention of the learned counsel for the appellant, that even if the partial partition referre....
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.... previous year,- (a) the total income of the joint family in respect of the period up to the date of partition shall be assessed as if no partition had taken place; and (b) each member or group of members shall, in addition to any tax for which he or it may be separately liable and notwithstanding anything contained in clause (2) of section 10, be jointly and severally liable for the tax on the income so assessed. (5) Where a finding of total or partial partition has been recorded by the Assessing Officer under this section, and the partition took place after the expiry of the previous year, the total income of the previous year of the joint family shall be assessed as if no partition had taken place; and the provisions of clause (b) of sub-section (4) shall, so far as may be, apply to the case. (6) Notwithstanding anything contained in this section, if the Assessing Officer finds after completion of the assessment of a Hindu undivided family that the family has already effected a partition, whether total or partial, the Assessing Officer shall proceed to recover the tax from every person who was a member of the family before the partition, and every such person shall b....
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....erty admits of, but a mere severance of status shall not be deemed to be a partition; (b) "partial partition" means a partition which is a partial as regards the persons constituting the Hindu undivided family, or the properties belonging to the Hindu undivided family, or both." 6. Relying on clause (1) of Section 171 of the Act, it is contended on behalf of the appellant-assessee that the assessment permissible under Section 171 of the Act envisaged certain pre-requisites. Firstly, the aforesaid assessment must be in respect of property of a Hindu Family. Secondly, the assessment must be in respect of such a Hindu Undivided Family which has hitherto been assessed as a Hindu Undivided Family. Although, the facts in this case depict that at some point in time the appellant-assessee was a Hindu Undivided Family but there is no dispute whatsoever, that the appellant-assessee has not been assessed as a Hindu Undivided Family prior to the Assessment Year 1997-98. In view of the fact, that the conditions prerequisite for the application of Section 171 of the Act are not fulfilled by the appellant-assessee. In the present case, it is the submission of the learned counsel for the app....
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.... Undivided Family, under Section 171 of the Act. The aforesaid finding rendered by the Commissioner of Income Tax (Appeals) dated 27.06.2003, was assailed by the Revenue before the Income Tax Appellate Tribunal. The Income Tax Appellate Tribunal agreed that the Revenue vide order dated 10.06.2005. In other words, the Income Tax Appellate Tribunal arrived at the conclusion that the property in question was liable to be assessed in the hands of the appellant as a Hindu Undivided Family under Section 171(9) of the Act. It is pertinent to mention that sun-section (9) of Section 171 of the Act is in the nature of an exception to sub-Section(1) of Section 171 of the Act (relied) upon by the appellant. The order passed by the Income Tax Appellant Tribunal dated 10.06.2005 has also been challenged at the hands of the appellant by asserting that the same is inapplicable in this case. 9. During the course of hearing of the instant appeal, learned counsel for the respondent has solely relied on subsection( 9) of Section 171 of the Act to defeat the claim of the appellant. It is the vehement contention of the counsel for the respondent that partition of the Hindu Undivided Family in the pre....