[1970] 78 ITR 69 (SC)
SUPREME COURT OF INDIA
Commissioner of Income-tax
Versus
M.K.K.R. Muthukaruppan Chettiar
J.C. SHAH, V. RAMASWAMI AND A.N. GROVER, JJ.
CIVIL APPEAL NOS. 1664 AND 1665 OF 1968
OCTOBER 6, 1969
JUDGMENT
Ramaswami, J.
Karuppan Chettiar, his son, Muthukaruppan, and the latter’s minor sons all together formed a Hindu undivided family which was assessed as such till the end of the assessment year 1948-49. In the course of assessment proceedings for 1949-50, the family claimed on February 7, 1951, that the several businesses of the family had been partitioned between Karuppan Chettiar on the one hand and Muthukaruppan Chettiar and his sons forming a separate family on the other. Following up this claim the returns in response to the notice under section 22(2) of the Income-tax Act, 1922 (hereinafter called the Act), issued to the family for the assessment years 1950-51, 1951-52 and 1952-53 were made by Karuppan Chettiar in his individual capacity showing the income from the several sources that fell to his share. The Income-tax Officer rejected the claim of partition and assessed the Hindu undivided family for the aforesaid three years treating Karuppan Chettiar’s returns as the proper returns for the family. An appeal was made by the assessee to the Appellate Assistant Commissioner in which complete partition as required by section 25A of the Act was accepted by the Appellate Assistant Commissioner by his order dated December 18, 1954. In keeping with this order he also cancelled the assessments of the family for the aforesaid years. In the course of his order he observed:
“I therefore hold that there is no asset left in the hands of the Hindu undivided family which can be brought to tax and that the Hindu undivided family is no longer in existence. As such the present assessment requires to be annulled and the income considered in this assessment requires to be considered in the hands of the separating coparceners. I therefore annul these assessments”.
2. Meanwhile, Muthukaruppan and his minor sons forming the family, the assessee in this case, filed returns for the Tamil years Virothi, Vikruthi and Kara as the “previous years” for the assessment years 1950-51, 1951-52 and 1952-53 as follows:
