Section 171 of Income Tax Act "Assessment after partition of a Hindu undivided family"
171. (1) A Hindu family hitherto assessed as undivided
shall be deemed for the purposes of this Act to continue to
be a Hindu undivided family, except where and in so far as a
finding of partition has been given under this section in
respect of the Hindu undivided family.
(2) Where, at the time of making an assessment under section
143 or section 144, it is claimed by or on behalf of any
member of a Hindu family assessed as undivided that a
partition, whether total or partial, has taken place among
the members of such family, the Assessing Officer shall make
an inquiry thereinto after giving notice of the inquiry to
all the members of the family.
(3) On the completion of the inquiry, the Assessing Officer
shall record a finding as to whether there has been a total
or partial partition of the joint family property, and, if
there has been such a partition, the date on which it has
taken place.
(4) Where a finding of total or partial partition has
been recorded by the Assessing Officer under this section,
and the partition took place during the previous year,-
(a) the total income of the joint family in respect of the
period up to the date of partition shall be assessed as if
no partition had taken place; and
(b) each member or group of members shall, in addition to
any tax for which he or it may be separately liable and
notwithstanding anything contained in clause (2) of section
10, be jointly and severally liable for the tax on the
income so assessed.
(5) Where a finding of total or partial partition has been
recorded by the Assessing Officer under this section, and
the partition took place after the expiry of the previous
year, the total income of the previous year of the joint
family shall be assessed as if no partition had taken place;
and the provisions of clause (b) of sub-section (4) shall,
so far as may be, apply to the case.
(6) Notwithstanding anything contained in this section, if
the Assessing Officer finds after completion of the
assessment of a Hindu undivided family that the family has
already effected a partition, whether total or partial, the
Assessing Officer shall proceed to recover the tax from
every person who was a member of the family before the
partition, and every such person shall be jointly and
severally liable for the tax on the income so assessed.
(7) For the purposes of this section, the several liability
of any member or group of members thereunder shall be
computed according to the portion of the joint family
property allotted to him or it at the partition, whether
total or partial.
(8) The provisions of this section shall, so far as may be,
apply in relation to the levy and collection of any penalty,
interest, fine or other sum in respect of any period up to
date of the partition, whether total or partial, of a Hindu
undivided family as they apply in relation to the levy and
collection of tax in respect of any such period.
(9) Notwithstanding anything contained in the foregoing
provisions of this section, where a partial partition has
taken place after the 31st day of December, 1978, among the
members of a Hindu undivided family hitherto assessed as
undivided,-
(a) no claim that such partial partition has taken place
shall be inquired into under sub-section (2) and no finding
shall be recorded under sub-section (3) that such partial
partition had taken place and any finding recorded under
sub-section (3) to that effect whether before or after the
18th day of June, 1980, being the date of introduction of
the Finance (No. 2) Bill, 1980, shall be null and void;
(b) such family shall continue to be liable to be assessed
under this Act as if no such partial partition had taken
place;
(c) each member or group of members of such family
immediately before such partial partition and the family
shall be jointly and severally liable for any tax, penalty,
interest, fine or other sum payable under this Act by the
family in respect of any period, whether before or after
such partial partition;
(d) the several liability of any member or group of members
aforesaid shall be computed according to the portion of the
joint family property allotted to him or it at such partial
partition,
and the provisions of this Act shall apply accordingly.
Explanation.-In this section,-
(a) "partition" means-
(i) where the property admits of a physical division, a
physical division of the property, but a physical division
of the income without a physical division of the property
producing the income shall not be deemed to be a partition;
or
(ii) where the property does not admit of a physical
division, then such division as the property admits of, but
a mere severance of status shall not be deemed to be a
partition;
(b) "partial partition" means a partition which is partial
as regards the persons constituting the Hindu undivided
family, or the properties belonging to the Hindu undivided
family, or both.
172. (1) The provisions of this section shall,
notwithstanding anything contained in the other provisions
of this Act, apply for the purpose of the levy and recovery
of tax in the case of any ship, belonging to or chartered by
a non-resident, which carries passengers, livestock, mail or
goods shipped at a port in India.
(2) Where such a ship carries passengers, livestock, mail or
goods shipped at a port in India, seven and a half per cent
of the amount paid or payable on account of such carriage to
the owner or the charterer or to any person on his behalf,
whether that amount is paid or payable in or out of India,
shall be deemed to be income accruing in India to the owner
or charterer on account of such carriage.
(3) Before the departure from any port in India of any such
ship, the master of the ship shall prepare and furnish to
the Assessing Officer a return of the full amount paid or
payable to the owner or charterer or any person on his
behalf, on account of the carriage of all passengers,
livestock, mail or goods shipped at that port since the last
arrival of the ship thereat:
Provided that where the Assessing Officer is satisfied that
it is not possible for the master of the ship to furnish the
return required by this sub-section before the departure of
the ship from the port and provided the master of the ship
has made satisfactory arrangements for the filing of the
return and payment of the tax by any other person on his
behalf, the Assessing Officer may, if the return is filed
within thirty days of the departure of the ship, deem the
filing of the return by the person so authorised by the
master as sufficient compliance with this sub-section.
(4) On receipt of the return, the Assessing Officer shall
assess the income referred to in sub-section (2) and
determine the sum payable as tax thereon at the rate or
rates in force applicable to the total income of a company
which has not made the arrangements referred to in section
194 and such sum shall be payable by the master of the ship.
(4A) No order assessing the income and determining the sum
of tax payable thereon shall be made under sub-section (4)
after the expiry of nine months from the end of the
financial year in which the return under sub-section (3) is
furnished:
Provided that where the return under sub-section (3) has
been furnished before the 1st day of April, 2007, such order
shall be made on or before the 31st day of December, 2008.
(5) For the purpose of determining the tax payable under
sub-section (4), the Assessing Officer may call for such
accounts or documents as he may require.
(6) A port clearance shall not be granted to the ship until
the Collector of Customs, or other officer duly authorised
to grant the same, is satisfied that the tax assessable
under this section has been duly paid or that satisfactory
arrangements have been made for the payment thereof.
(7) Nothing in this section shall be deemed to prevent the
owner or charterer of a ship from claiming before the expiry
of the assessment year relevant to the previous year in
which the date of departure of the ship from the Indian port
falls, that an assessment be made of his total income of the
previous year and the tax payable on the basis thereof be
determined in accordance with the other provisions of this
Act, and if he so claims, any payment made under this
section in respect of the passengers, livestock, mail or
goods shipped at Indian ports during that previous year
shall be treated as a payment in advance of the tax leviable
for that assessment year, and the difference between the sum
so paid and the amount of tax found payable by him on such
assessment shall be paid by him or refunded to him, as the
case may be.
(8) For the purposes of this section, the amount referred to
in sub-section (2) shall include the amount paid or payable
by way of demurrage charge or handling charge or any other
amount of similar nature.