HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Piyare Lal Adishwar Lal v. Commissioner of Income-tax, Delhi
Civil Appeal No. 123 of 1957
[1960] 3 SCR 669 ·
Indian Income-tax Act, 1922: sections 7 and 10
Sources & disclosures includedDownload original judgment / order
3-judge bench · S. K. Das · J. L. Kapur · M. Hidayatullah
Assessment years: 1951-52
01 · Facts of the case
The HUF karta became a bank treasurer after serving as its overseer. Joint-family assets secured his fidelity. Revenue treated his remuneration as HUF business income rather than his individual salary.
Source: Primary report: SCR 670–672
02 · Discussion by the Hon’ble Court
The agreement as a whole gave the bank due supervision and control; staff-supply and indemnity obligations were consistent with this treasurer’s employment. Personal experience supported appointment, and merely lodging family property as security did not establish expenditure or detriment producing the remuneration.
Source: Primary report: SCR 672–680
03 · Judicial decision
The remuneration was salary assessable under section 7, not business profits under section 10, and belonged to the individual rather than the HUF.
Source: Primary report: SCR 680
04 · Outcome / in whose favour
The HUF’s appeal was allowed, the High Court judgment set aside, and costs awarded here and below.
Source: Primary report: SCR 680
05 · AKHB REVIEW POINT
Analyse contractual control and the causal link between family assets and earnings separately. The use of family security alone did not make this personal employment income HUF income; the Court distinguished a managing-directorship financed and created through family business assets.
Source: Primary report: SCR 676–680
Source & verification
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Statutory scope
Historical legislation expressly identified in this note. This is not a decision under the Income-tax Act, 1961 or the Income-tax Act, 2025. Verify enacted wording, commencement, transition and subsequent judicial treatment independently before modern reliance.
Later treatment
Source checked 2026-10-23. Subsequent treatment and present-law applicability have not been comprehensively checked.
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