1965 (11) TMI 39

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....fied in assessing the income of the minors in the hands of the guardians as the income of a Hindu undivided family." The relevant facts out of which the reference arose are as follows: Shri Kishanlal Agarwalla died intestate in December, 1950, leaving his widow and two minors, Basanta and Ashok. Prior to his death he was being assessed as an individual on the income arising from the business carried on in the name of Shri Krishan Rice Mills, Tejpur. He was governed by the Mitakashara school of Hindu law. The widow also died in 1952. On the death of the widow an application was made by Shri Nandlal Agarwalla to the Court of the District Judge, Gauhati, for being appointed as a guardian of the person and the properties of the two minors, Ba....

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....r 1953-54, but it is clear that this order has no application to this accounting year. The Income-tax Officer, by his order dated October 19, 1957, assessed the guardians under section 23(3) read with section 41 of the Act. The guardians filed an appeal before the Appellate Assistant Commissioner contending that the assessment was bad in law. The Appellate Assistant Commissioner by his order dated May 19, 1956, set aside the assessment and directed the Income-tax Officer to reassess after obtaining two separate returns from the appellants and to frame two separate individual assessments. He came to the conclusion that "the very fact that separate guardians for the two minors were appointed by the court with directions to separately accoun....

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.... under the Hindu law, by which the minors are governed, their shares are specific and determinate and they can only be assessed under section 41 in the manner and to the extent the assessment can be made on each of the two minor children individually on whose behalf such income was receivable by the guardians had not been adverted to. The Appellate Tribunal, however, replied that the contention referred to in the application had been omitted to be dealt with in the order of the Tribunal as it became academic in the light of the Tribunal's decision that the assessee was a Hindu undivided family. The Tribunal refused to state a case under section 66(1) of the Act, but on being directed to do so by the Assam High Court, it drew up a statement ....

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....uld have been assessed individually on their separate incomes. He says that under section 7 of the Guardians and Wards Act, no guardian could have been appointed in respect of the undivided interest of a minor and, therefore, the court must have proceeded on the basis that the properties had been divided among the minors. He further points to the order dated March 25, 1958, which shows that the interest of the minors was separate. It is not necessary to decide the question whether under the Guardianship Act a guardian could have been appointed in respect of the undivided interest of the minors. There is authority for the proposition that when all the coparceners are minors, a guardian can be appointed for the whole number (see Bindaji Lax....