Law:

Section:

Section 2(xii), read with section 2(xxiv), of the Gift-tax Act, 1958 - Gift - Whether when a member of Hindu undivided family throws property into common hotchpotch, it cannot be said that he enters into transaction with his family with meaning of section 2(xxix)(d) and as such he is not liable to pay gift-tax - Held, yes - Whether it would make no difference whether separate property is impressed with character of joint family property by male member of family or by female member of family - Held, yes FACTS The two assessees, one male and another female, held one-half share each in a building. During the previous year, each of the two assessees impressed his or her share in the said property with the character of joint family property. The GTO and the AAC decided the matter against the assessees and held that they were liable to pay gift-tax. The Tribunal held that the assessees were not liable to pay gift-tax as the act of the assessees in throwing their individual share in the joint family hotchpotch did not amount to gift within the meaning of the Act. On reference : HELD In order to invoke sub-clause (d ) of clause (xxiv) of section 2 it has to be shown that there was a transaction entered into by one person with another. The above clause cannot apply to a unilateral act. When a member of a Hindu undivided family throws property into the common hotchpotch, it cannot be said that he enters into a transaction with his family. It would make no difference in principle so far as the applicability of Act is concerned, whether the separate property is impressed with the character of joint family property by a male member of the family or by a female member of the family. Note : The case was decided in favour of the assessee. CASES REFERRED TO Goli Eswariah v. Commissioner of Gift-tax [1970] 76 I.T.R. 675 (S.C.), H.H. Maharana Rajasaheb Shri Pratapsinhji Saheb of Wankanerv. Commissioner of gift-tax [1970] 78 I.T.R. 1 (S.C.) and Mallesappa Bandeppa Desai v. Desai Mallappa [1961] 3 S.C.R. 779 ; a.I.R. 1961 S.C. 1268 and Commissioner of Income-tax v. Pushpa Devi [1971] 82 I.T.R. 7 (Delhi). JUDGMENT Khanna, CJ.- The following question has been referred to this court…

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