JUDGMENT

VENKATARAMIAH, J. :— These two appeals by certificate - one by the assessee and the other by the Commissioner of Income-tax, Kanpur are filed against the judgment and order dated Sept. 29, 1972 of the High Court of Judicature at Allahabad in Income-tax Reference No. 47 of 1971 under Section 256 (1) of the Income-tax Act, 1961 (hereinafter referred to as the Act) made by the Income-tax Appellate Tribunal, Allahabad Bench, Allahabad (for short the Tribunal). The two questions which were referred by the Tribunal for the opinion of the High Court were:

"(1) Whether on the facts and in the circumstances of the case the Tribunal was right in holding that the properties in dispute were capable of division in definite portions amongst the 10 coparceners; as contemplated in Explanation (a) (i) to Section 171 of the Income-tax Act, 1961 and that even otherwise the mere severance of status was not sufficient to entitle the assessee to succeed in its claim for partial partition?

(2) Whether on the facts and in the circumstances of the case the Tribunal was justified in holding that the income from the properties in dispute which were accepted to have been partitioned under the Hindu law but with regard to which an order accepting the claim of partial partition was not made was liable to be included in the computation of the assessees income?"

2. The assessee is a Hindu undivided family known as M/s. Kalloomal Tapeshwari Prasad and the year of assessment is 1964-65. The assessee is governed by the Mitakshara school of law. The following genealogical tree represents the relationship amongst the members of the family:

3. During the relevant previous year, the family consisted of Chandoolal, Sitaram and his wife Kripa Devi, Jagat Nararin, Roop Narain, Swarup Narain, Shyam Narain and Bimal Narain who were the five sons of Chandoolal and Gopalji and Ramji, the two sons of Sitaram. The assessee (Hindu undivided family) was deriving income from various sources such as income from property, income from money lending business, income from speculation business and cloth business etc. There was a partial partition in the family in the year 1951 when a sum of Rs. 5,00,000 out of its total Capital of Rs. 12,85,423 was divided amongst the coparceners at the rate of Rs. 11,666/10/8 amongst members of Chandoolals branch and at the rate of Rs. 83,333/5/4 amongst the members of Sitarams branch. Kripa Devi did not receive any share at that partition. The said partial partition was accepted and acted upon by the Income-tax Department whereafter the Cloth business was treated as the business of a firm consisting of most of the coparceners as partners, Again on December 11, 1963 which fell within the previous year relevant for the assessment year in question i.e. 1964-65, according to the assessee, there was another partial partition orally as a result of which its eighteen immovable properties were divided amongst the ten members of the family and that they held those properties as tenants-in-common from that date. It was claimed by the assessee in the course of the assessment proceedings that the members of the family had commenced to maintain separate accounts with regard to the income from the said eighteen properties and to divide the net profits amongst themselves according to their respective shares at the end of each year. The eighteen immovable properties were situated in different places and their valuation was as follows :-

Sl. No. Municipal number of the property. Value.

1. 75/2 1,78,875/-

2. 76/162 27,000/-

3. 76/169 45,000/-

4. 47/110 13,500/-

5. 47/26 20,700/-

6. 48/203 16,200/-

7. 55/124 90,000/-

8. 55/36} 41,400/-

9. 55/37}

10. 70/87 1,57,500/-

11. 71/150 8,100/-

12. 71/89 3,600/-

13. 71/112 19,800/-

14. 63/61 7,425/-

15. 51/68 17,100/-

16. 51/73 14,400/-

17. 86/37 20,520/-

18. 1/301A 45,000/-

7,26,120/-

4. When required by the Income-tax Officer to explain as to why the properties were not divided in definite portions as required by S. 171