Law:

Section:

Section 26 of the Income-tax Act, 1961 - (Corresponding to section 9 of the Indian Income-tax Act, 1922) - Income from House Property - Co-owners - Assessment years 1958-59 and 1959-60 - Whether income from house properties which are in joint possession of the coparceners of HUF governed by Dayabhaga school of Hindu law should be assessed separately in their individual hands in proportion to their shares in family properties under section 9(3) of 1922 Act and section 26 of 1961 Act, - Held, yes FACTS The assessee family was governed by the Dayabhaga School of Hindu law. Formerly, the entire property belonged to a HUF which consisted of four brothers. One brother died leaving behind him his two sons, and thereafter the HUF consisted of five members. In relevant assessment year, one of the brother gifted his undivided one-fourth share in the properties to his son. The ITO included the income from the remaining three-fourths share of the said properties in the total income of the assessee family. The assessee contended that the bigger HUF consisting of five member not being the owner of the remainder of the properties, after the gift, was not assessable under section 9 of 1922 Act, in respect of the income therefrom. The Tribunal held that the income from the remainder of the property was not assessable in the hands of the appellant family and it should be excluded from its total income. On reference : HELD The essence of a coparcenary under the Dayabhaga law is unity of possession. It is not unity of ownership at all. Every coparcener takes a defined share in the property, and he is the owner of that share. That share is defined immediately the inheritance falls in. Even before partition, any coparcener can say that he is entitled to a particular share. So long as there is unity of possession, no coparcener can say that a particular share of the property belongs to him; that he can say only after a partition. Partition then, according to the Dayabhaga law, consists in splitting up joint possession and assigning specific portions of the property to the several coparceners. Thus, the heirs of a Dayabhaga Hindu have defined shares in the properties belonging to them…

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