Law:

Section:

Section 25A of the Indian Income-tax Act, 1922 [Corresponding to section 171 of the income-tax act, 1961] - Hindu undivided family - Assessment after partition - Assessment order passed by ITO in case of a HUF without holding an inquiry into validity of claim of partition made within a reasonable time by a member of HUF - Whether such assessment liable to be cancelled - Held, yes - Whether tribunal dealing with such question in appeal can merely cancel ITO's order without a further direction to assessing authority either to modify assessment suitably or to pass a fresh order of assessment in accordance with law-Held, no Facts An assessment order for the assessment year 1955-56, being made on the assessee-HUF on 30-5-1959, was set aside by the AAC on 24-2-1962 with a direction to make fresh assessment. When fresh assessment proceedings were commenced pursuant to the aforesaid direction, the assessment proceedings for the assessment years 1957-58 and 1958-59 were also taken up. Earlier by a number of letters, the assessee's karta had requested the ITO for an order under section 25A of the 1922 Act [corresponding to section 171 of the 1961 Act]. The assessments for the assessment years 1955-56 to 1958-59 were, however, completed between 31-8-1962 and 27-3-1963 without holding an inquiry as contemplated by section 25A regarding the factum of partition. The ITO, thereafter, started an inquiry under section 25A and by his order dated 30-3-1965 refused to record the partition. On appeal, the AAC set aside the ITO's order and directed the ITO to record the partition under section 25A as on 10-7-1960. That order became final as no appeal was filed against it by the department. However, for the assessment years 1959-60, 1960-61 and 1961-62, the ITO had passed the assessment orders before the AAC held that the partition had taken place on 10-7-1960. In the appeals filed before the AAC against the assessment orders for the assessment years 1955-56 to 1961-62, it was contended by the assessee that the assessments were liable to be set aside on the ground that the inquiry into the claim of partition which was a condition precedent for making an order of assessment on the HUF…

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