TMI Blog1986 (2) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... g to each one of the minors on partial partition of the family on 9-3-1973 was brought in as their share of capital in the firm. The firm continued the business up to the assessment year 1975-76. On 1-4-1975 there was a change in the constitution of the firm, inasmuch as the minors were eliminated from the partnership and the business of the firm was continued by the major partners under a deed dated 27-10-1975. The firm as constituted under this deed continued the business up to the assessment year 1979-80. The amounts standing to the credit of the minors as on the date of their withdrawal from the firm stood as advances made to the firm and the firm continued to pay interest on these amounts. There was again a change in the constitution of the firm with effect from 1-4-1979 on account of the retirement of one Shri G. Venkatayya from the partnership and in his place Smt. G. Ramulamma joined the partnership. On account of this change a fresh deed was executed on 22-6-1979 under which the partners were Shri G. Venkatesham and Smt. G. Ramulamma each having 40 per cent and 60 per cent shares, respectively. In this partnership deed dated 22-6-1979 it was stated in clause 9 that the fir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by taxing the same in the hands of the assessee. He held that if it is finally decided that the income is assessable in the hands of the assessee it is open to the assessee to approach the Commissioner for cancellation of the assessment of the minor under section 264 of the Act. Against the said order, the assessee has preferred this appeal. 2. The learned counsel for the assessee strongly urged that in view of clause 9 of the partnership deed it is clear that the assessee is benamidar of his minor son to the extent of 50 per cent of his share in the firm. The funds of the minor credited in his name in the books of the firm have been utilised for the business of the firm and as such he was entitled to share of 50 per cent from the assessee. Thus, the assessee is benamidar of his minor son Shri G. Venkata Subbaiah to the extent of 50 per cent of his share of profit in the firm. The share in the firm is a property. 50 per cent of the profit has been credited to the account of the minor. In Form No. 12A it has been shown that the assessee is benamidar of his son to the extent of 50 per cent of his share of profit. He further contended that since assessment has been made in the hands ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reated as benamidar of his son Shri G. Venkata Subbaiah to the extent of 50 per cent of his share. In our view we cannot hold that the assessee is benamidar of his son Shri G. Venkata Subbaiah to the extent of 50 per cent of his share in the firm. Merely because of the recitals in the partnership deed it is not possible straight-away to accept the plea of the assessee that he is benamidar of his minor son Shri G. Venkata Subbaiah to the extent of 50 per cent of his share. In this connection we may refer to the decision of the Supreme Court in CIT v. Durga Prasad More [1971] 82 ITR 540 wherein it was held that where a party relied on self-serving recitals in documents, it was for that party to establish the truth of those recitals and the taxing authorities were entitled to look into the surrounding circumstances to find out the reality of such recitals. It was observed as under : "... In a case of the present kind a party who relies on a recital in a deed has to establish the truth of those recitals, otherwise it will be very easy to make self-serving statements in documents either executed or taken by a party and rely on those recitals. If all that an assessee who wants to evade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a form prescribed under section 185(1) Explanation (b) of the Act as well as rule 24A of the Income-tax Rules, 1962, to enable the assessee to claim registration. The said form by itself does not establish the benami plea put up by the assessee. The onus is on the assessee to establish the benami plea put up by him but the same has not been established in the instant case. One of the important circumstances to prove benami is the source of investment. We have already pointed out that the source of investment of capital in the firm was out of the funds of the assessee alone but not out of the funds of his minor son. Thus, the benami plea put up by the assessee has not been proved. 5. The assessment on the minor for the assessment year 1980-81 has been made only as a protective measure. So it cannot be held that there is double taxation. If tax has been collected from the minor in respect of the 50 per cent of the share included in the assessment, we are sure the department would refund his said amount. The assessee may approach the Commissioner in this regard. 6. In our view in order to get over the provisions of section 64(1)(iii) which has come into effect from 1-4-1976 th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on have no application to the facts of the instant case. The decision of the Gujarat High Court in Nandiniben Narottamdas' case is a case where the assessee had made gift of her shares in the two firms in favour of the beneficiaries of the trust. On those facts the Gujarat High Court held that the share income from the firm stood diverted to the trust by overriding title even before it reached the assessee and such income could not be assessed in her hands. That has no relevance here. In Jyotsnaben Narottamdas' case, the assessee executed a declaration donating her income from the firm to a trust for the benefit of here daughters. On those facts the Gujarat High Court held that no part of the income from the firm was assessable in the assessee's hands, in view of the declaration executed. In Y.S. Desale's case the Bombay High Court held on the facts of the case that when the income is received by an agent he receives it for and on behalf of the principal and there is no question of any overriding title. Since the promoters received the income as agents of shareholders the promoters would not have any title to the income which really vested in the shareholders and there was no ques ..... X X X X Extracts X X X X X X X X Extracts X X X X
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