Status of Assessee

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Bhaskaran Chackrapani Warrier (Querist)
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13 July 2010 A family(not an HUF) consisting of 27 members got a vacant urban land in the year 1981 by a partition deed in which the right of each member is specified as undivided equal right. Now they are selling the land and LTCG arises in the deal. How to file the IT return. Whether one return in the status of "Body of Individuals" ot 27 returns by adopting each of them as co-owners need to be filed. Pl advise.

sivadas chettoor

sivadas chettoor (Expert)
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14 July 2010 Your attention is invited to the decision of the Hon'Supreme Court in CIT V Indira Balakrishna, which is regarded as a magnum opus in this area of law. Much depends upon the factual matrix and it needs a very careful analysis.An AOP is created when two or more persons join in a common purpose or action and the object of the association must be to produce income, profits and gains.In 49 ITR 39 Madras High court came to the conclusion that co-owners, co-legatees etc do not constitute AOP simply because of their legal relationship in respect of income unless they unite consciously to produce income.Since BOI in your case is the same as AOP ( persons being individuals) the decisions apply.So you will have to find out something in the facts which can be relied upon to justify the assessment in the hands of the sharers individually.

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