In Anwar Basith v. ACIT, the Bangalore ITAT held that the income of minor beneficiaries can be clubbed to income of parents under section 64(1)(a) of Income Tax Act, 1961. Assessee was a partner of Firm, M/s. INJ Enterprises, along with her husband and three minor children with equal distribution of profit among the partners including the three beneficiaries. The partnership firm was dissolved in the year 1989 with a condition that all the 5 partners would possess the asset and the liability of the firm as coowners and tenants in common and have equal shares in land & building. One of the source of funds used by M/s. INJ Enterprises for construction and development of the aforesaid property was a loan from Dr. Nayeema Khan Trust for which the Firm was paying interest. The said Trust was formed by assessee and her husband, Mr. Maqsood Ahmed as a trustee and their children as beneficiaries of the trust. While completing assessment against the assessee, the AO noted that to Pay ...