Gireesh Bhalla : Wealth tax assessment after partition of a Hindu undivided family

A)        Assessment after partition of Hindu Undivided Family :-

i)          As per section 20 of Wealth Tax Act where at the time of making an assessment, it is brought to the notice of the Assessing Officer that a partition has taken place among the members of Hindu Undivided Family, and the Assessing Officer, after inquiry, is satisfied that the joint family property has been partitioned as a whole among the various members or group of members in definite portions, he shall record an order to that effect and shall make assessment on the net wealth of the undivided family as such for the assessment year or years, including the year relevant to the previous year in which the partition has taken place, if the partition has taken place on the last day of the previous year and

each member or group of members shall be liable jointly and severally for the tax assessed no the net wealth of the joint family as such.

ii)         Where the Assessing Officer is not so satisfied, he may, by order, declare that such family shall be deemed for the purposes of this Act to continue to be a Hindu Undivided Family liable to be assessed as such.

B) Assessment after partial

partition of a Hindu Undivided Family :-

As per section 20A of Wealth Tax Act where a partial partition has taken place after the 31st day of December, 1978 among the members of a Hindu Undivided Family hithereto assessed as


i) such family shall continue to be liable to be assessed under this Act as if no such partial partition had taken place ;

ii) 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 ;

iii)         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- For the purposes of this section, “partial partition” shall have the meaning assigned to ti in clause (b) of the Explanation to section 171 of the Income Tax Act.