Law:

Section:

Section 4 of the Income-tax Act, 1961 - Individual - Assessable as - Assessee's-HUF, a kerala joint HUF, was a partner in a firm - Kerala Joint Hindu Family System (Abolition) Act, 1975, abolished joint family system among Hindus in the State with effect from 1-12-1976 and all members of a HUF holding any coparcenary property were deemed to hold his or her share separately as full owner thereof as if partition had taken place among all members of that HUF - Whether for assessment year 1978-79, even when no partition had been recorded under section 171 in HUF of assessee, his share in its income from aforesaid firm was assessable in his hands in individual status - Held, yes Facts The HUP of the assessee was a partner in a firm for the assessment year 1978-79. The ITO included in the income of the assessee a certain sum as his share in the income of the HUF from that firm. On appeal, the assessee contended that because no partition had been recorded as required under section 171 in respect of the HUP which had been hitherto assessed as HUF the share income was properly assessable only in the hands of the HUF and not of the members thereof. The Tribunal held that in view of the Kerala Joint Hindu Family System (Abolition) Act, 1975 the HUF should be deemed to have been parti- tioned with effect from 1-12-1976 and the assessee's share in the income of the HUF from the firm was includible in his hands in individual status. On reference : Held On and after 1-12-1976, no joint family existed in the State of Kerala. The aforesaid 1975 Act is one enacted to abolish the joint family system among the Hindus in the State. All members of an undivided Hindu family governed by the Mitakshara law holding any coparcenary property on the day the Act came into force are thereafter deemed to hold it as tenants-in-common as if a partition had taken place among all the members of that undivided Hindu family as respects such property and as if each one of them is holding his or her share separately as full owner thereof. Therefore, after 1-12-1976 the individual members of the family have distinct share in the property and this change has been brought by the operation of law and not…

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