TaxTMI 
TaxTMI 
1979 (9) TMI 35
X X X X Extracts X X X X
X X X X Extracts X X X X
....oresaid business amounting to Rs. 22,124 odd was divided between the father and the son, the assessee receiving Rs. 11,062 out of the same as his share. After the partition, the family business was converted into a partnership business, the partners being the father and the son. That firm continued up to October 15, 1964, when the assessee became partner in two firms, M/s. Arjun Das Banarsi Lal and M/s. Banarsi Das Niranjan Lal. At that time his capital in the erstwhile firm, M/s. Arjun Das Banarsi Lal, had increased to Rs. 80,309. On October 15, 1964, the assessee debited his individual account by Rs. 50,000 in the books of the firm, M/s. Arjun Das Banarsi Lal, and credited that amount to the HUF account opened in his name and the balance ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... September 29, 1973. The Appellate Tribunal did not agree with the view which had been taken by the AAC for the reason that no doubt the family of which the assessee was the karta had undergone a partial partition in 1955, but had continued joint and undivided in so far as the immovable properties were concerned and, thus, the assessee was a coparcener and had an interest in the coparcenary property. However, the property which he had received on partial partition would be treated as an ancestral property in his hands though for income-tax purposes he was being assessed as an individual on the income from that property and further that the assessee could not be allowed to undo the partial partition. In that view of the matter, the claim of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ls for the preceding six years we do not find any discussion in regard to property income and hence there being no material before us, this part of the question is to be returned unanswered. Now, coming to the main dispute, the facts, as have been set out in the earlier part of this judgment, are not in dispute and the question that falls for our consideration is as to what is the character of the property received by a coparcener in a partition--partial or complete. We will confine ourselves to the case of a partial partition. A partition between coparceners may be partial either in respect of a property or in respect of persons making it, vide para. 328(1) of the Principles of Hindu Law by Mulla, 14th Edn. In the present case, the copa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....behalf of the assessee. As laid down in Krishna Prasad v. CIT [1974] 97 ITR 493 (SC) : " The share which a coparcener obtains on partition of ancestral property is ancestral property as regards his male issue. They take an interest in it by birth, whether they are in existence at the time of partition or are born subsequently. Such share, however, is ancestral property only as regards his male issue. As regards other relations, it is separate property, and if the coparcener dies without leaving male issue, it passes to his heirs by succession..... " It has also been held : " A person who for the time being is the sole surviving coparcener is entitled to dispose of the coparcenary property as if it were his separate property. He may se....
X X X X Extracts X X X X
X X X X Extracts X X X X
....operty would have passed to his heirs by succession and would not have devolved by survivorship. Therefore, in the absence of any male issue the assessee was the absolute owner of this property and he could deal with it in any manner he liked. It was contended by Sri Ashok Gupta that what is required for the purpose of blending is that the coparcener must have property which was originally self-acquired and for this he has placed reliance on the decision of the Supreme Court rendered in G. Narayana Raju v. G. Chamaraju, AIR 1968 SC 1276. What has been held in that case is that : " It is a well-established doctrine of Hindu Law that property which was originally self-acquired may become joint property if it has been voluntarily thrown ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... male issue other than the one, who had separated, the assessee was the absolute owner of this property and further its character being that of a separate and self-acquired property, the assessee could impress it with HUF character. All that was further required was that this act of the assessee should have been voluntary and there should have been a clear intention on his part to waive his separate right on this property. So far as these two condi- tions are concerned, there is no dispute. In our opinion, therefore, the assessee could impress the disputed property with HUF character and hence when he joined the firm, M/s. Arjun Das Banarsi Lal, on its re-constitution on October 16, 1964, as karta of the HUF consisting of himself and his so....