Law: Income Tax Act, 1961

Section: 143,147

Income-tax--Assessment--Body of individuals---Death of -owner of proprietary concern--- Business continued by widow on behalf of heirs of deceased--- Business assessable as body of individuals---Indian Income Tax Act, 1961, Ss. 143 & 147. The husband of the assessee, who was a doctor, was the owner of a proprietary concern namely, a clinical laboratory. He died in 1973. The widow of the deceased continued the business on behalf of her minor son and unmarried daughter and two married daughters from the deceased's first wife. For the assessment years 1974-75, 1975-76 and 1976-77, the Income-tax Officer assessed the income from the clinic taking the status as "body of individuals". On appeal, the Tribunal assessed the income of the concern in the hands of each heir of the deceased. On a reference: Held, that the business was carried on by the widow of the deceased and was in the common interest and object of all the heirs of the deceased. Therefore, the status for assessing the income from the concern as "body of individuals" was proper. Meera & Co. v. CIT (1979) 120 ITR 564 (P&H) fol. G:N. Sunanda v. CIT (1988) 174 ITR 66 (Kar.) distinguished. CIT v. Harivadan Ribhovandas (1977) 106 ITR 494 (Guj.) ref. JUDGMENT By this reference application, the Tribunal has referred to the following question for our opinion: "Whether, on the facts and in the circumstances of the case, the Tribunal is correct in law in holding that there is no unity of interest to assess the income from the clinic in the hands of the assessee as body of individuals and that the assessments in the hands of each heir and legal representative should be made separately according to his/her share as per law?" The assessee, Smt. Renuka Ganguly and others, were carrying on business in the name and style of "National Clinical and Research and Laboratory". It was a proprietary concern of the late Dr. A.N. Ganguly who died on May 26, 1973, intestate leaving behind him the second wife. Sint. Renuka Ganguly, one unmarried daughter and one minor son from the above second wife and two married daughters from the deceased first wife. A search was made on September 18, 1976, at the above clinic as…

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