Commissioner of Income Tax vs Manjeri Kovilakam Interim Management Committee

K.S. Paripoornan, J.—At the instance of the Revenue, the Income Tax Appellate Tribunal (in short, "the Tribunal") has referred the following question of law for the decision of this court :

"Whether, on the facts and in the circumstances of the case, the assessee (the group of 33 individuals) could be assessed in the status of a Hindu undivided family for the assessment year 1971-72 ?"

The respondent-assessee is a "Marumakathayam" family in the erstwhile Malabar area. It possessed large properties, movable and immovable. Up to the assessment year 1968-69, it was filing the returns in the status of a Hindu undivided family. It was assessed in that status. There was a registered agreement dated July 16, 1961, whereby the members of the family decided to become separate. The matter of division was agreed to be referred to an arbitrator. The said agreement was modified by a later agreement dated March 22, 1962. The arbitrator rendered the award on September 11, 1967. In the award, it was held that the properties should be administered in accordance with the earlier agreement dated March 22, 1962. The assessee filed returns for the year 1971-72 for which the previous year ended on March 31, 1971, in the status of a Hindu undivided family. The assesment was completed on that basis. In appeal, the Appellate Assistant Commissioner followed his earlier order for the year 1969-70 and held that there was no Hindu undivided family for the year 1971-72. The matter went up before the Tribunal. The Appellate Tribunal, relying upon the decision in Income Tax Officer, Assessment V Vs. Smt. N.K. Sarada Thampatty, , held that Section 171 of the Income Tax Act, 1961, is inapplicable and when division by metes and bounds is impossible, the partition had to be accepted. On motion by the Revenue and as directed by this Court in petitions filed u/s 256(2) of the Income Tax Act, the Tribunal referred an identical question for the assessment years 1969-70, 1970-71 and 1972-73 to 1975-76--a question of law which arose out of the order of the Appellate Tribunal, for the decision of this court in I. T. Rs. Nos. 206 to 211 of 1982 ( COMMISSIONER OF Income Tax Vs. MANJERI KOVILAKAM INTERIM MANAGEMENT COMMITTEE., ). In the said batch of referred cases, the following question of law was referred for the decision of this Court :

"Whether, on the facts and in the circumstances of the case, the assessee (the group of 33 individuals) could be assessed in the status of a Hindu undivided family for the assessment year 1969-70 ?"

That was a common question referred for the years 1969-70 to 1975-76. Following the decision of the Supreme Court in Kalloomal Tapeswari Prasad (HUF), Kanpur Vs. Commissioner of Income Tax, Kanpur, , this Court answered the question in the affirmative, in favour of the Revenue and against the assessee. This Court further held that Sarada Thampatty''s case [1976] 105 ITR 67 stood impliedly overruled by the decision of the Supreme Court in Kalloomal Tapeswari Prasad (HUF), Kanpur Vs. Commissioner of Income Tax, Kanpur, .

It is obvious that the question of law referred in this case, relating to the assessment year 1971-72, is similar to the question of law referred to this Court in the batch of cases, I. T. Rs. Nos. 206 to 211 of 1982 COMMISSIONER OF Income Tax Vs. MANJERI KOVILAKAM INTERIM MANAGEMENT COMMITTEE., ), relating to the assessment years 1969-70, 1970-71, etc.

In the light of the Bench decision of this court in the said batch of referred cases, dated November 20, 1987, we should answer the question referred to this Court in the affirmative, in favour of the Revenue and against the assessee. We do so.

A copy of this judgment under the seal of this court and the signature of the Registrar will be forwarded to the Income Tax Appellate Tribunal, Cochin Bench.