Law: Income Tax Act, 1922

Section: 16,16(3)(a),(i),(ii)

[Income Tax Act, 1922 (XI of 1922)].........Section 16(3) (a), (i), (ii) (as amended by the Finance Act, 1965)-Total income-Minor-After death of busband his widow carrying on business in partnership with a major daughter- Minor children admitted to the benefits of partnership- Share of profits of the minor children-Whether includible in the total income of the In other-Held yes-Expressions, "Any individual", "Such individual" and "Spouse"--Scope of after amendment of Section 16 (3), by the Finance Act, 1965. Cases referred to: Commissioner of Income Tax v. Khatja Begum (1965) 12 Taxation 95 (S. C.) and Commissioner of Income Tax v. Mst. Fatima Bibi (1968) 17 Taxation 115. ORDER [The judgment of the Court was delivered by S. RAHMAN].-At the instances of the assessees the Income Tax Appellate Tribunal has referred under Section 66 (1) of the Income Tax Act the following questions of the arising out of the assessment of three years. (1) Whether on the facts and circumstances of the case income of the minors admitted to the benefits of the partnership was includible in the income of their mother under Section 16(3) (a) (ii) of the Income Tax Act, 1922? (2) Whether the word "spouse" as used in 16 (3) (a) as amended b Act V of 1965, is also applicable to a Widow whose husband has died? 2. The facts in brief are that one Wazir Khan was a licensed dealer in liquor and on his death the licence Was, under the relevant rules transferred in the name of his widow and children all of whom excepting one were at the relevant time minors. The Window and the major daughter formed a partnership to carry on this business and the minor children were admitted to the benefits of partnership. The income of the minors was clubbed with the income of their mother under provisions of Section 16 (3) (a) (ii) of the Income Tax Act. This was challenged and the Appellate Assistant Commissioner upheld the contention of the assessee that such clubbing was not in accordance with law. An appeal was preferred to the Tribunal which set aside the order of the Appellate Assistant Commissioner and restored that of Income Tax Officer. Hence a question has been raised whether the income of the minors…

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