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Issues:
Interpretation of section 64(1)(ii) of the Income-tax Act, 1961 regarding clubbing of income from spouse's salary, Qualification required to avoid clubbing of income, Application of technical or professional knowledge for income attribution. Analysis: The judgment dealt with the interpretation of section 64(1)(ii) of the Income-tax Act, 1961, concerning the clubbing of income from the spouse's salary. The primary issue was whether the spouse possessed technical or professional qualifications and if the income was solely attributable to the application of technical or professional knowledge and experience. The assessee claimed that her husband, who received a salary from a firm, had the necessary technical qualifications based on experience in the carpet trade. However, the Income Tax Officer (ITO) did not find any evidence of formal qualifications and deemed the work to be non-specialized. The Appellate Authority Commissioner (AAC) upheld the decision, emphasizing the need for formal qualifications. The appellant argued that formal degrees were not essential and relied on precedents and certificates to prove technical knowledge. The departmental representative opposed the certificates' admission and cited contrary precedents. The Tribunal analyzed previous decisions, emphasizing the need for technical or professional qualifications to avoid income clubbing. The Tribunal referred to cases where technical knowledge was acquired through apprenticeship and where lack of evidence led to income clubbing. The Tribunal defined professional qualifications as the ability to undertake a job independently and technical knowledge as specialized mechanical or scientific expertise. In this case, the husband's work was not deemed specialized, and there was no evidence of formal qualifications or specialized training. The Tribunal rejected new evidence presented through certificates obtained after the AAC's order, citing procedural violations. The Tribunal also dismissed the argument based on the husband's self-assessment and previous AAC rulings, emphasizing the lack of technical or professional qualifications and the non-specialized nature of the work. Ultimately, the Tribunal concluded that the husband lacked technical or professional qualifications, and his salary was not solely attributable to specialized knowledge or experience. The Tribunal clarified that the term 'experience' in the proviso included experience gained during technical or professional qualification acquisition. The Tribunal highlighted the conjunctive nature of the proviso, requiring both technical qualifications and income attribution to technical knowledge. Consequently, the appeal was dismissed, upholding the income clubbing under section 64(1)(ii) of the Income-tax Act, 1961.
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