TMI Blog1970 (12) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... ed partition deed dated December 31, 1954, between himself and his two minor sons represented by the mother-guardian. In the said partition, lands were divided by metes and bounds. According to the petitioner the minor sons were in separate possession and enjoyment of the lands falling to their share. While submitting his returns for the assessment year 1955-56 the petitioner excluded the income of the lands allotted to his minor sons. In the ultimate assessment after remand, the assessing officer held that the income of the minor sons from the lands allotted to them separately must constitute a part of the income of the petitioner and section 11(1) was applicable. The petitioner was unsuccessful both in first appeal and second appeal. He filed an application under section 29(2) for referring a case to the High Court on the following questions of law arising out of the second appellate order. Those questions were : " (i) Whether, in the facts and circumstances of the case, section 11(1) of the Act is applicable and as such the income of the two minor sons would be included in the income of the assessee for the assessment years 1955-56, 1956-57 and 1958-59 to 1962-63 ? (ii) Whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 was genuine or not. We were constrained to call for a further statement of fact. In the further statement of fact the Tribunal has expressed its inability to give an answer as, according to it, necessary data to declare the partition deed sham are lacking. We would proceed to clarify the factual and legal position. There is a registered partition deed recording partition by metes and bounds. The assessee presents the deed as being genuine. There is no evidence contra that it is a sham transaction. On the other hand, the assessee and the minor sons are being separately assessed with income-tax and they are paying rents separately for lands allotted to their respective shares. The only feature which seems to have obsessed the taxing authorities is that the minors are jointly living and having a common mess with the father and mother and that there is no evidence that the lands are being separately cultivated and the usufruct thereof is being separately stored. Partition amongst the members of a joint family is effected for various reasons. Sometimes the family becomes unwieldy and it becomes uncomfortable to remain together. In many cases positive dissensions affect the peace a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. When there is a partition by a decree of a court or a registered partition deed, usually the court accepts the same as genuine unless it is established by the sum-total of facts and circumstances that it is sham. In this case there were no circumstances before the taxing authorities to reach the conclusion that the registered partition deed was not genuine. The petitioner is a substantial person. If his properties had not been partitioned amongst his sons he would have been liable to be heavily assessed on the total income being held in the hands of one individual. Joint cultivation and joint living by themselves are not determinative of the fact that the members of a family have not partitioned. When authentic and clear evidence in the shape of a registered partition deed or a decree of a court is lacking, courts examine other indicia like cesser of commensality, separate living and separate cultivation as features to lead to the conclusion one way or the other. But, when authentic evidence is available, those factors cannot detract from the effectiveness thereof unless as a result of the assessment of the sum-total of the evidence the court comes to the conclusion that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agricultural income is derived, as a common manager appointed under any law for the time being in force or under any agreement or as receiver, administrator or the like on behalf of persons jointly interested in such land or in the agricultural income derived therefrom, the aggregate of the sums payable as agricultural income-tax by each person on the agricultural income derived from such land and received by him shall be assessed on such common manager, receiver, administrator, or the like, and he shall be deemed to be the assessee in respect of the agricultural income-tax so payable by each such person and shall be liable to pay the same." It would appear from the aforesaid two sections that the expression " holds " has been used in both the sections. In section 11 (1) the expression " for the benefit of " has been used while in section 12 the corresponding expression is " on behalf of ". At the appropriate place we would examine the significance of these expressions. Under section 11 the lands must be held by a person for the benefit of the beneficiaries. In such a case the total agricultural income derived from such lands would be assessed to tax as if such person had exclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... common manager, receiver, administrator or the like not as the owner but as the agent or representative of these persons. Under section 12 there is no vestige of ownership in the common manager or receiver. All that the common manager is entitled to do is to manage or administer the land on behalf of persons who are jointly interested in the agricultural income derived therefrom. Under section 12 a common manager or receiver or administrator holds land for different persons who have title and possession. If the common manager is assessed to tax in respect of the land that he holds on behalf of different persons, each of those persons would be separately taxed in respect of their income and the total tax so assessed separately would be collected from the common manager. The incidence of taxation would be much lower than what it is under section 11. The same is not the position in the case of owners or trustees who hold the land on their own behalf and for their own benefit. As agent holding property belonging to the principal or guardian holding property belonging to the minor has no right of ownership in the property. He cannot be said to be holding the property for the bene ..... X X X X Extracts X X X X X X X X Extracts X X X X
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