The real income of an assessee is not the artificial income, but the income after deducting any amount that is diverted and never constituted his real income.

CHAGLA, C. J. :- There was a joint family consisting of Motilal Manekchand and his son Maganlal. Motilal, Maganlal and Motilals wife Bhagirathibai were appointed managing agents of the Pratap Mills at Amalner, and the father and son were appointed managing agents of the New Pratap Mills at Dhulia. It is common ground that the managing agency belonged to the Joint and undivided Hindu family. This Hindu family was partitioned on the 1st July 1948 and a document was drawn up on the 29th June 1949 to give effect to that partition. There are three Schedules to this deed of dissolution allocating joint family properties to the three parties who were entitled to equal shares on the partition of the joint Hindu family viz., the father Motilal, the son Maganlal, and the wife or the mother Bhagirathibai. There was a provision with regard to the managing agency commission and the provision was that Motilal and Manganlal were entitled to equal shares in this managing agency commission of the two Mills, but they both undertook to pay to Bhagirathibai 2 annas and 8 pies share each out of their respective 8 annas share, and when we turn to the three Schedules we find that in Schedules dealing with the fathers and the sons property, what is credited to them is 8 annas share of the managing agency commission of both the Mills less a annas and 8 pies, and when we turn to the Schedule dealing with Bhagirathibais properties we find that the 2 annas and 8 pies share in each of the managing agency commission is credited to her, and it is sufficient to note that in each Schedule the total properties allocated comes to Rs. 13,03,646/- and this amount is arrived at after taking into consideration the managing agency commission. After the dissolution of the family the father and son constituted a partnership and acted as the managing agents of these two Mills, and the contention was put forward both by the firm and by each individual partner that the managing agency commission received by them and in respect of which they were liable to pay tax was not the full 16 annas received by them but 16 annas less the amount which went to Bhagirathibai. This contention was rejected by the Department and the Tribunal accepted the view of the Department. The assessee has now come before us.

2. Now, the real question that we have to consider is this. What is the real income of each of the two partners, viz., the father Motilal and the son Maganlal? Is his income 8 annas in the managing agency commission of the two Mills, or is part of that income diverted so that the real income of the partner is not 8 annas but 8 annas less the amount which is diverted in favour of Bhagirathibai? Now, it is necessary to remove one or two misunderstandings that might have been caused by certain contentions put forward by the assessee before the Tribunal. In the first place, this is not a case where a claim is made in respect of any deduction under the provisions of the Income-tax Act. If such a claim had been put forward, then we would have to consider the various sections of the Act in order to determine whether the deduction is justified. But it is clear position in law, as we shall presently point out, that even though an assessee may not be allowed to claim a particular amount as a deduction falling within the provisions of the Act, he would be entitled to urge that his real income should be considered and if a certain amount is to be deducted in order to ascertain his real income, such a deduction would have to be made notwithstanding that the Income-tax Act made no provision for such a deduction. In all cases of tax, what has got to be considered is what is the income of the assessee, and when that question arises what has got to be considered is the real income and not any artificial income, and for the purpose of ascertaining that real income every part of that income which may seem to be his income, if in fact it is not his income, if that part has been diverted an