Law:

Section:

Section 263 of the Income-tax Act, 1961 [Corresponding to section 33B of the Indian Income-tax Act, 1922] - Revision - Of order prejudicial to interest of revenue - Whether where assessment of assessee as an individual had become final before order of Commissioner, that did not bar exercise of jurisdiction by Commissioner under section 33B(1) of 1922 Act - Held, yes Section 4 of the Income-tax Act, 1961 [Corresponding to section 3 of the Indian Income-tax Act, 1922] - Hindu undivided family - Assessable as - Assessment year 1954-55 - Whether income received by a member of a HUF from a firm or a company in which funds of HUF are invested, even though income may be partially traceable to personal exertion of member, is taxable as income of HUF, if it is earned by detriment to family funds or with aid or assistance of those funds - Held, yes FACTS "The assessee" set up a motor transport business. Subsequently, certain disputes arose between the assessee and his brothers about the division of the estate of the joint family of which they were members. The disputes were settled by mutual agreement and the motor transport business together with the "workshop, stores, agency, cinema companies, etc." were treated as the business of the joint family, and on partition were allotted to the assessee. In the meantime, a private limited company, was floated with the object of taking over the motor transport business carried on by the assessee. By the articles of association, the assessee was to be the governing director of the company for life and to draw such remuneration and exercise such powers detailed in the agreement to be entered into between him and the company. The company also passed a special resolution allotting certain shares in favour of assessee for his service. The ITO brought to tax in the relevant assessment year the remuneration received by the assessee from the company together with the commission, "sitting fee" and income from property, business and other sources as the separate income of the assessee. AAC modified that order, and directed that the income other than salary, commission and "sitting fee" received from the company be included in the…

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