Vijayvargiya, J.
1. By this reference under Section 256(1) of the I.T. Act, 1961 (hereinafter referred to as 'the Act'), the Income-tax. Appellate Tribunal, Indore Bench, Indore, has referred the following questions of law for the opinion of this court:
RA Nos. 95 & 96: A.Ys. 1972-73 & 1973-74
'1. Whether, under the facts and in the circumstances of the case, the Tribunal was right in law in holding that the ITO was justified in initiating proceedings under Section 147 ?
2. Whether, under the facts and circumstances of the case, the Tribunal was correct in law in confirming the order under Section 143(1)/147 clubbing the share incomes of the two minor children, while the same was not shown ?
3. Whether, under the facts of the case as well as the provision of law, without cancelling the already completed assessment of the minors, in respect of the share incomes from a firm, wherein their father was also a partner, the share incomes of the minors could be again assessed in the hands of their father and whether this type of double assessment of the same income is permissible under the provisions of the Income-tax Act, 1961 ?
4. Whether, under the true literal construction of the provisions of law as provided under Section 64(1)(ii), the Tribunal was legally correct to hold that the assessment of the share incomes of the two minor children of the appellant in his individual hands was justified, and whether Section 64(1)(ii) provides for the clubbing of the share incomes of all the minor children or of a minor child only ?'
R. A. No. 97 : A.Y. 1974-75
'1. Whether, under the facts of the case as well as the provision of law, without cancelling the already completed assessment of the minors, in respect of the share incomes as determined in the case of the firm, wherein their father was also a partner, the share incomes of the minors could be again assessed in the hands of their father, and whether this type of double assessment of the same income is permissible under the provisions of the I.T. Act, 1961 ?
2. Whether, under the true literal construction of the provisions of law as provided under Section 64(1)(ii), the Tribunal was legally correct to hold that the assessment of the share incomes of the two minor children of the appellant in his individual hands was justified, and whether Section 64(1)(ii) provides for the clubbing of the share incomes of all the minor children or of a minor child only ?'
2. The material facts giving rise to this reference are as follows: The assessee is a partner in the firm, M/s. Munnalal Jawaharlal & Company, Vidisha. Two minor sons of the assessee, namely, Shri Chakreshkumar and Shri Mahendrakumar, were admitted to the benefits of the partnership in the said firm. Two assessments of the assessee for the assessment years 1972-73 and 1973-74 were completed by the ITO by taking only the assessee's own share of income from the said firm. The two minors filed their returns of income declaring their share income from the said firm and they were also assessed separately. Later on, the ITO came to know that the provisions of Section 64 of the Act were applicable. He, therefore, issued notices under Section 148 to the assessee for the assessment years 1972-73 and 1973-74. In the regular assessment for the assessment year 1974-75 the ITO clubbed the income of the two minor sons in the hands of the assessee under Section 64 of the Act. The assessee objected to the inclusion of the share income of his minor sons on the ground that the minors had their separate funds which they invested in the firm and, therefore, the provisions of Section 64 of the Act were not attracted. The ITO did not accept the contention of the assessee. He included the share income of the two minor sons in the assessment of the assessee in all the assessment years under dispute.
3. In the appeal preferred by the assessee before the AAC it was contended that the reopening of the assessments for the years 1972-73 and 1973-74 was illegal because the ITO had applied his mind while completing the assessments of the assessee as well as the two minor sons and hence the subsequent initiation of proceedings under Section 147 for clubbing the income of the minor sons in the hands of the assessee was illegal because it was a case of change of opinion. The AAC rejected the contention of the assessee. He held that, on the facts and in the circumstances of the case, the ITO had jurisdiction to issue notice under Section 147 of the Act to the assessee when he later on came to know of the omission or failure on the part of the assessee to disclose the income of the minors. On merits also, the AAC upheld the order of the ITO. On further appeal by the assessee before the Tribunal, the Tribunal upheld the reopening of the assessments for the assessment years 1972-73 and 1973-74 under Section 147 of the Act and also the clubbing of the income of the two minor sons in the hands of the assessee. At the instance of the assessee the Tribunal has referred the aforesaid questions of law for the opinion of this court:
We have heard the learned counsel for the parties. As regards questions Nos. 1 and 2 in R.A. Nos. 95 and 96 (assessment years 1972-73 and 1973-74) the Appellate Tribunal in para. No. 4 of his order has observed as follows: '......The learned counsel for the assessee after arguing for some timeabout the legality of initiation of proceedings under Section 147 for the A.Ys. 1972-73 and 1973-74, conceded that the provisions of Section 64 of the I.T. Act are very clear and the assessee should have included towards his own total income, the share of his two minor sons in the same firm in which he was a partner. However, his only contention was that since the two minors have already been assessed separately in respect of the share income derived by them from the said firm, the inclusion of the same income in the hands of the assessee would amount to the double taxation of the same income......'
4. Now, in view of the above concession made on behalf of the assessee before the Tribunal the question of legality or otherwise of the initiation of proceedings under Section 147 of the Act for the assessment years 1972-73 and 1973-74 does not arise. As the Tribunal was not required to deal with the aforesaid questions and the Tribunal has, in fact, not dealt with them in view of the concession made on behalf of the assessee, questions Nos. 1 and 2 do not arise out of the order of the Tribunal. We, therefore, decline to answer the aforesaid questions.
R. A. Nos. 95 & 96 : A.Ys. 1972-73 & 1973-74 : Re. Question No. 3
5. Now, in view of the provisions of Section 64 of the Act, the share income of the minors in the firm has to be clubbed with the income of the assessee and has to be assessed in his hands. If the minors have been assessed separately they may move the Commissioner under Section 264 of the Act for a cancellation of their assessments in view of the fact that the income derived by them from the firm has been clubbed in the hands of the assessee. We may also state that the learned counsel for the Department stated before us that the Commissioner of his own motion will take steps to cancel the orders of assessment made against the minors,
6. No provision of law was brought to our notice by the learned counsel for the assessee under which the income of the minors which has to be assessed in the hands of the assessee under Section 64 of the Act cannot be so assessed because the minors have been separately assessed. Our answer to question No. 3, therefore, is in the affirmative and against the assessee.
R. A. Nos. 95 & 96 : A.Ys. 1972-73 & 1973-74 : Re. Question No. 4
7. This question presents no difficulty. Section 13 of the General Clauses Act provides that in all Central Acts and Regulations, unless there is anything repugnant in the subject or context, words importing the masculine gender shall be taken to include females; and words in the singular shall include the plural, and vice versa. Therefore, if an assessee has more than one minor son whose income has to be assessed in his hands the income of all such sons has to be clubbed with his income under Section 64(1)(ii) of the Act. The Tribunal was, therefore, legally correct to hold that the assessment of the share income of the two minor children of the assessee in his individual hands was justified, and Section 64(1)(ii) of the Act provides for 'the clubbing' of the share income of all the minor children. The question is answered accordingly.
R. A. No. 97: A.Y. 1974-75 : Re. Question No. 1
8. For reasons stated above while answering question No. 3 of the above group our answer to this question is in the affirmative and against the assessee.
R.A. No. 97 : A.Y. 1974-75 : Re. Question No. 2
9. For reasons stated while answering question No. 4 of the above group, our answer to this question is that the Tribunal was legally correct to hold that the assessment of the share income of the two minors of the assessee in his individual hands was justified and Section 64(1)(ii) provides that for the clubbing of the share, income of all the minor children.
10. The reference is answered accordingly. In the circumstances, the parties shall bear their own costs of this reference.