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Section 64 of the Income-tax Act, 1961 - Transfer of assets - For benefit of spouse or minor child - Assessment year 1976-77 - Whether income of minor children could be included to nil income of assessee so as to be a basis for assessing him - Held, yes FACTS In the previous year relevant to the assessment year 1976-77, the assessee had no income of his own. However, his two minor sons, who were admitted to the benefits of partnership, received certain amount towards their share of profits. The ITO included the amounts derived by his two minor sons from the firm in the total income of the assessee and completed the assessment. On second appeal, the Tribunal held that in absence of any income of the assessee, income of the minor sons could not be included. On reference : HELD Following the decision in the case of CIT v. Manakram [1990] 183 ITR 382 (MP) where it was held that income of the minor children can be included to the nil income of the assessee so as to be the basis for assessing him, in the instant case, the Tribunal was not justified in holding that minor son's income from the firm could not be assessed in the hands of their father on the ground that father had no income of his own. CASE REVIEW CIT v. Shri Manakram [1990] 183 ITR 382 (MP) followed and relied upon. CASE REFERRED TO CIT v. Manakram [1990] 183 ITR 382 (MP). A.K. Roy for the Applicant. B.K. Mahantz for the Respondent. JUDGMENT S.C. Mohapatra, J. - This is a reference under section 256(2) of the Income-tax Act, 1961 where statement of case was called for on the following question of law: "Whether, on the facts and in the circumstances of the case, the Tribunal is justified in its conclusion that the minor sons' income from the firm cannot be assessed in the hands of their father as the father has no income of his own?" 2. The assessee is an individual. For the assessment year 1976-77, the previous year for which ended on 31-3-1976 the assessee had no income of his own. However, his two minor sons, namely, Santosh…

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