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TMI Blog1965 (6) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... rred-on the motion of the Commissioner of Income-tax, Kerala---relates to these receipts and is worded as follows: " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the income from salary, commission and sitting fees obtained by Sri P. N. Krishna Iyer from Messrs. P. S. N. Motors (Private) Ltd., Trichur, represented his individual income and not the income of the Hindu undivided family of which he is the karta? " The P.S.N. Motors (Private) Ltd. was incorporated on July 3, 1952. There were only two shareholders, Krishna Iyer mentioned in the question referred and a nephew of his. Krishna Iyer took a hundred shares and the nephew twenty. The value of each share was Rs. 100. Articles 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with Sri. P. N. Krishna Iyer was signed. His remuneration was fixed as an office allowance of Rs. 3,000 per mensem and a commission of 15 per cent. on the net profit. " It is not contended that the payment of Rs. 3,000 per month represents a payment by way of office allowance and not a payment by way of salary. The main matter for determination, as we see it, is the source of the Rs. 10,000 which Krishna Iyer paid for the hundred shares he took on the formation of the company. Those shares are the foundation of the salary, commission and sitting fees with which we are concerned ; and if the price of those shares came not from the personal funds of Krishna Iyer but from those of the Hindu undivided family of which he was the karta, there c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mencement of the business for which it was formed for a sum of Rs. 8,01,074.14 nP. No portion of the consideration was paid and there was not even a written agreement to pay interest on the amount. (2) About a month later, on September 28, 1952, the company passed the following special resolution : " That in consideration of the valuable services rendered by Sri P. N. Krishna lyer for the promotion of this company and the very large sacrifices he has made in agreeing to place his services at the disposal of the company and the immense benefit that the company received on account of his long experience, goodwill and reputation in this line of business, which can modestly be valued at Rs. 5 lakhs, it is resolved that 4,880 shares of the val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anates. In all cases where the income is traceable to family property, it must partake of the joint family character, and it would not be open to the manager or any other member of the family to claim it as his own individual and separate income." In the light of what is stated above, we must answer the question in the negative and in favour of the department. We do so. The second question referred -on the motion of the assessee-reads as follows : " Whether the Commissioner has jurisdiction to revise the order of the Income-tax Officer in view of the decision of the Appellate Assistant Commissioner in appeals for the assessment years 1954-55 to 1957-58 in the assessment of Sri P. N. Krishna Iyer in the status of an individual ? " We are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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