9911796707
TMI Blog1976 (5) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... her, and his three sons, viz., Chandrabhan, Bengali Lal and Brij Kishan. Gauri Shankar, the karta of the family, who was in charge of the affairs of the family during the relevant year which extended from April 13, 1945, to April 12, 1946, the assessment year being 1946-47, died on April 2, 1946. He was succeeded by his son, Chandrabhan, as karta of the family. The appellant had, in the first instance, filed a return showing an income of Rs. 9,701. On scrutiny of the relevant material, the Income-tax Officer found a number of discrepancies in the accounts of the appellant and also noted the existence of cash credits to the appellant's account in the books of another firm, viz., M/s. Tilyani Glass Works and a certain sum deposited in an acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal to the Appellate Assistant Commissioner, who reduced the penalty to Rs. 15,000. Not satisfied with this reduction, the appellant went up in further appeal to the Income-tax Appellate Tribunal and raised before it a number of contentions. Amongst other things, it was urged before the Tribunal that since the Hindu undivided family had disrupted on June 22, 1956, as accepted by the Income-tax Officer in his aforesaid order dated March 26, 1962, passed under section 25A(1) of the Act, the imposition of the penalty by the Income-tax Officer on March 20, 1958, after the disruption of the family was bad in law and could not be sustained. While rejecting the other contentions raised on behalf of the appellant, the Tribunal upheld this contenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el appearing on behalf of the revenue has, on the other hand, urged that imposition of the impugned penalty cannot be challenged as, in view of section 25A(3) of the Act, a Hindu undivided family must be deemed to have continued in existence till the date of the passing of the order under section 25A(1) of the Act. For a proper determination of the question, it is necessary to refer to section 25A of the Act which at the relevant time stood as under: "25A. (1) Where, at the time of making an assessment under section 23, it is claimed by or on behalf of any member of a Hindu family hitherto assessed as undivided that a partition has taken place among the members of such family, the Income-tax Officer shall make such inquiry thereinto as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as such. (3) Where such an order has not been passed in respect of a Hindu family hitherto assessed as undivided, such family shall be deemed, for the purposes of this Act, to continue to be a Hindu undivided family." It will be noticed that sub-section (3) of the above-quoted section embodies a legal fiction according to which a Hindu family which has been previously assessed as "undivided" is to be continued to be treated as "undivided" till the passing of the order under sub-section (1) of the, section. This view gains strength from two decisions of this court in Additional Income-tax Officer, Cuddappah v. A. Thimmayya and joint Family of Udayan Chinubhai, etc. v. Commissioner of Income-tax, where it was held that so long as no order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been partitioned in definite portions, or if on account of some error or inadvertence he fails to dispose of the claim. In all these cases his jurisdiction to assess the income of the family hitherto assessed as undivided remains unaffected, for the procedure for making assessment of tax is statutory." In the face of the aforesaid decisions of this court, it is not necessary to burden the record by discussing the decisions cited by counsel for the appellant. In the present case, there was not a whisper of the application under section 25A(1) of the Act by the appellant on March 15, 1957, when the penalty proceedings were initiated against it. Even on March 25, 1958, when the penalty was imposed, there was no order under section 25A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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