THE COMMISSIONER OF INCOME TAX, KERALA versus SMT. P.K. KOCHAMMU AMMA PEROKE

Citation: [1981] 1 S.C.R. 781 · Decided: 23-09-1980 · Supreme Court of India · Bench: P.N. BHAGWATI, E.S. VENKATARAMIAH · Disposal: Dismissed

Judgment (excerpt)

l ' 
THE COMMISSIONER OF INCOME TAX, KERALA 
v. 
SMT. P.K. KOCHAMMU AMMA PEROKE 
September 23, 1980 
[P. N. BHAGWATI AND E. S. VENKATARAMIAH, JJ.] 
Penalry, imposition of-Assessee faiied to include the income of the spouse 
'flnd minor child in the return of income for the assessment year 1964-65. though 
includible under s. 64(1) and (iii)-Whether 
failure 
entails 
penalty 
under 
s. 271(I)(c) of the Income Tax Act, 1961, as the unamended Rule 12 of the 
1961 (prior to 31-3-1972) did not provide any column in the pre~cribed form-
Jncome Tax Act, 1961, ss. 2(45), 4, 5, 64(1)(i) and (iii), 139 and 271(1){c) read 
with Rule 12 of the lllcome Tax Rulu, 1962,_scope of-Words and phrases "his 
income" meaning of. 
The respondent asses see was. a partner in the partnership firms of MI s. 
Malabar Tile Works and M/s. Malabar Ply,wood Works and alongwith .her 
there were other partners including her husband and minor daughter. In her 
returns for the assessment year 1964-65 for which the relevant accounting year 
. was the calendar year ending 31st D~cember, 19(i3, the assessee filed a return. 
of income omitting the amounts representing the shares of her husband and 
minor daughter in the partnership firms from her income. 
The Income Tax 
Officer, however, brought the amounts, namely, Rs. 59,506 to tax and referred 
. the case for taking action under s. 271(1)(c) of the Act to the Assistant Appel-
late Commissioner who imposed a penalty of namely, Rs. 7,000 on the assessee 
for having concealed her income. 
In appeal the Tribunal set aside the order 
and the High Court on reference affirmed the Tribunal's order. 
Hence the 
appeal by Revenue to this Court after obtaining special leave. 
Dismissing the appeal, the Court 
HELD : (1) The assessee, in view of the fact that the prescribed form 
for filing of returns under s. 139 of the Act, prior to 31st March, 1972, did 
not contain separate column to show "income arising to spouse/minor child 
or any 
other person referred to .in Chapter V of the Act", and in view 
of the decision of three Judges Bench reported in 74 l.T.R. 83 SC could not 
be said to have concealed her income by not disclosing in the return filed by 
her the amounts representing the shares of her husband and minor daughter 
in the two partnership firms. 
[788B] 
(2) The term "his income" for the purpose of s. 27l(l)(c) of the Act, is 
"his income" which the assessee is liable to disclose for the purposes of assess-
ment and yet fails to do so. 
The return of income under s. 139(1) of the 
· Act is required to be filed in order to enable the Revenue Authorities to 
make a proper assessment of tax 'on the assessee. 
A fortiorari, 1t follows that 
. 4he assessee ·must disclose in the return every item of income which is liable 
to be taxed in his hands under ss. 4 & 5 of the Act. [785B; F-H] 
781 
A 
B 
c 
D 
E 
F 
G 
H 
782 
SUPREME COURT REPORTS 
[1981] 1 S.C.R. 
A 
(3) The definition of "total income" in s. 2(45), no doubt refers to s. 5 
B 
c 
which lays down that all the income profits and gains accmed or arisen to' 
the assessee or received by or on behalf of the assessee shall be liable to be 
included in his total income but this provision is subject to the other provi· 
sions of the Act and therefore if the income of any other person is declared 
by any provision of the Act to be includible in computing !he total income 
of the assessee, such income would form part of the total income exigible· 
to tax under s. 4 of the Act. 
S. 64(1) is one such provision which provides 
for inclusion of the income of certain other persons in computing the total 
income of the assessee. 
[785F·H] 
Section 64(1) makes "it clear that though the share of the spouse or minor 
·child in the profits of a partnership firm in which the assessee is a partner is 
not the income of the assessee but is the income of such spouse or mir.or 
child it is liable to be included in computing the total income of the asse,.see 
and it would be assessable to tax in the hands of the assessee. The total income 
of the asses see chargeable to tax would include the amounts representinit the 
D 
~hares of the spouse and minor child in the profits of the partnership firm. 
Obviously the words "his income" in s. 139 sub·s. {I) must include every item 
of income which goes to make up his total income assessable under the Act. 
The amounts representing the shares of the spouse and minor child in the 
profits of the partnership firm would be part of

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