Law:

Section:

Section 64(1)(iii) of the Income-tax Act, 1961 - Transfer of assets - For benefit of spouse or minor child - Assessment year 1976-77 - A minor son of assessee was admitted to benefits of a partnership firm - Source of investment made in firm by minor was funds of HUF - Whether share income of minor son of assessee from firm was includible in total income of assessee in view of provisions of section 64(1)(iii) - Held, yes FACTS A minor son of the assessee was admitted to the benefits of a partnership firm and the source of investment made in the firm by the minor son was the funds of the HUF. While computing the total income of the assessee, the ITO included the share income of the minor son of the assessee from the firm in the total income of the assessee in view of the provisions of section 64(1) (iii) . On appeal, the AAC held that since the minor son represented the HUF in the partnership, the income falling to the share of the minor son of the assessee was liable to be taxed in the hands of the HUF and was not includible in the total income of the assessee. On appeal by the revenue, the Tribunal set aside the order of the AAC and restored the order of the ITO holding that the deletion of the share income of the minor son of the assessee from her total income was not justified in law. On reference: HELD What is material for the applicability of section 64(1)(iii) is that if the income arising to a minor child of an assessee from a partnership firm is referable to the fact of admission of that child to the benefits of the said partnership firm, then such income is includible in the total income of the assessee. The question of source of investment in the firm by the minor is not relevant or decisive for making the income of the minor includible in the total income of the assessee. Therefore, in the instant case, the share income of the minor son of the assessee from the firm was includible in the total income of the assessee in view of the provisions of section 64(1)(iii) . CASE REVIEW CIT v. Smt. Nirmala Devi [1987] 166 ITR 253 (MP)followed and relied upon. CASES REFERRED TO CIT v. Smt. Nirmala Devi [1987] 166 ITR 253 (MP). B.L. Nema for the Applicant. B.K.…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492