Law: Income Tax Act, 1961

Section: 64

Income-tax--Total income---Inclusions in total income ---HUF---Firm---Karta of HUF partner in his representative capacity---Income of minor sons from admission to benefits of partnership---Not includible in his individual total income--­Indian Income Tax Act, 1961, S.64. A Hindu undivided family is itself an assessable entity or unit. The income earned by the Karta is taxed in the hands of the Hindu undivided family. No part of such income is computed in his individual assessment. When section 64 of the Income Tax Act, 1961, speaks of "computation of the total income of any individual", it ex hypothesi excludes from such computations, income which is assessable in the hands of the Hindu undivided family. Section 64 does not deal with the share income of the Karta from the firm. It is confined to the clubbing together of the share income of the spouse or minor children of the individual from the firm, with such other income of that individual which is assessable in his individual status. It is thus, clear that the share income of the Karta from the partnership firm is not exigible to tax a second time under section 64. CIT v. Shri Om Prakash (1996) 217 ITR 785 (SC) fol. CIT v. Harbhajan Lal (1993) 204 ITR 361 (SC); CIT v. Jayantilal Prem Chand Shah (1995) 211 ITR 111 (SC); Dinubhai Ishvarlal Patel v. K.D. Dixit, ITO (1979) 118 ITR 122 (Guj.) and Hirday. Narain (L.) v. Income-tax Officer (1970) 78 ITR 26 (SC) ref. THIS JUDGMENT DELIVERED BY: The assessee, Shri Mulji Gordhandas, Morvi, was a partner in the firm, Hansraj Keshavji of Morvi, representing his Hindu undivided family. The three minor sons of the assessee, namely, Rajesh Munesh and Suresh, were admitted to the benefits of partnership firm. The assessee had been assessed in respect of his share of profit from the firm in the status of a Hindu undivided family. He had not filed any return in his status as individual, as he has no taxable income. The Income-tax Officer issued notice under section 148 requiring the assessee to file a return in his individual. capacity which was returned as nil. Applying section 64, the shares allotted to minor sons of the assessee, who were admitted to the benefits of…

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