In each of these seven years the Hindu undivided family as the assessee claimed that this sum of Rs.12,000 every year should be deducted as an expenditure under s. 10 2 xv oft he Income tax Act.
Thereupon at the request of the assessee appellant, the question reproduced by us was referred by the Tribunal for the opinion of the High Court.
Appeals by special leave from the judgment and order dated March 28, 1962 of the Allahabad High Court in I. T. Misc.
The Income tax Officer rejected the claimand that order was upheld by the Appellate Assistant Commissioner as well as by the Tribunal.
Consequently, these appeals have been brought up before us.
T. Desai, Gopal Singh and R. N. Sachthey, for the respondent in all the appeals .
The Judgment of the Court was delivered by Bhargava, J. These appeals by special leave are directed against the judgment of the Allahabad High Court returning an answer to the following question referred to it by the Income tax Appellate Tribunal Whether on the facts and circumstances of the case the salary paid or credited to a Karta of the family for looking after the familys business was a permissible deduction under s. 10 2 xv in companyputing the income of the family business.
The assessee was a Hindu undivided family carrying on a joint family business of companymission agency in cloth under the name of Jugal Kishore Baldeo Sahai and was, in addition, deriving income from some property and from some partnership business in which the karta Babu Ram was a partner representing the interest of the Hindu undivided family.
The High Court answered the question against the appellant and upheld the view of the Tribunal.
CIVIL APPELLATE JURISDICTION Civil Appeal Nos.
12,000 per year and similar credit in the name of Babu Ram was made in the accounts for seven years.
of Jugal Kishore Baldeo Sahai and the same amount was credited in the name of Babu Ram as an individual.
594 to 600 of 1965.
12,000 was debited in the expense account of the Hindu undivided family business, viz.,
K. Sen, T. A. Ramachandran, J. B. Dadachanji, for the appellants in all the appeals .
In June, 1946, the karta Babu Ram wrote a letter to his brother Gobardhandas, who was the only other adult member of the family, stating that, since he was managing all the business, he ought to get a salary of Rs.
The family companysisted of Babu Ram, his brother Gobardhandas and their sons.
Thus, the debit against the Hindu family business at the rate of Rs.
424 of 1959.
Gobardhandas promptly agreed to this proposal and companysequently in the account books of the family for the year in question a sum of Rs.
Case No.
The first such credit was made in the account year relevant to the assessment year 1946 47 and similar credits companytinued to be made in subsequent accounting years upto the year relevant to the assessment year 1952 53.
1,000 per month.
