COMMISSIONER OF INCOME-TAX vs. FARIDAHMED ABDULSAMAD

ITR/202/1986HC GujaratGJHC24010826198613 August 2001Author: HONOURABLE MR. JUSTICE ANIL R. DAVE,HONOURABLE MR. JUSTICE D.A.MEHTA3 pages
AI SummaryRemanded

What were the facts?

This case involves an Income Tax Reference filed by the revenue at the instance of the Commissioner of Income-tax against Farid Ahmed Abdulsamad. The reference concerns the assessment year(s) not explicitly stated but implied to be the same as a related trust case. The core issue is whether the share income of the assessee from the firm M/s. Neelam Industries and Weigh Bridge is the real income of the K.S. Lokhandwala Family Trust and thus taxable in the hands of the trust, not the assessee. The Income Tax Appellate Tribunal had previously ruled in favor of the trust. The High Court noted that while an appeal concerning the same assessment year and income might have been decided by the Tribunal or a reference filed in the High Court for the trust, specific details were unavailable from the advocates.

What did the High Court hold?

The High Court declined to answer the questions referred. The Court observed that it was not possible to ascertain whether the income the revenue wished to assess in the hands of the assessee was already included in the income of the K.S. Lokhandwala Family Trust through a final order of the Tribunal or a reference to the High Court. The Court reasoned that if the amount in question was already treated as the income of the Trust by a final order, it would be improper to tax the assessee again for the same income. In the absence of specific information regarding the final outcome of the trust's case, the High Court could not render an opinion. Consequently, the Court directed the Tribunal to examine the record of the K.S. Lokhandwala Family Trust's case and pass a necessary order after considering the final decision in the trust's matter. The reference was disposed of accordingly.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the finding of the Appellate Tribunal that the share income of the assessee from M/s. Neelam Industries and Weigh Bridge is the real income of the K.S. Lokhandwala Family Trust and is liable to be assessed in the hands of the trust and not in the hands of the assessee is correct in law and sustainable from the material on record? (Question of law) 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal has been right in law in declaring that the share income of Rs. 98,643/- of the assessee from M/s. Neelam Industries and Weigh Bridge was in fact income of K.S. Lokhandwala Family Trust? (Question of law) Assessee's contentions: Not recorded. Revenue's contentions: The revenue contended that the share income received by the assessee was indeed the assessee's income and should be assessed in their hands, not the trust's. They sought to challenge the Tribunal's finding that the income belonged to the K.S. Lokhandwala Family Trust.

Which sections of the Income-tax Act were involved?

Section 256(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No 202 of 1986

For Approval and Signature:

Hon'ble MR.JUSTICE A.R.DAVE and Hon'ble MR.JUSTICE D.A.MEHTA

============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements?

2.

To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement?

4.

Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder?

5.

Whether it is to be circulated to the Civil Judge? : NO

The order continues below.

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