Law:

Section:

Section 3 of the Wealth-tax Act, 1957 - Charge of tax - Assessment year 1957-58 - Whether trustees of private trust constitute an assessable unit under provisions of Act - Held, yes Section 5(1)(i) of Wealth-tax Act, 1957 - Exemptions - Property held by charitable and religious trust - Assessment year 1957-58 - Whether trust created primarily for benefit of members of family could not be said to be trust for any public purpose so as to eligible for exemption under section 5(1)(i) - Held, yes FACTS 'G', 'R', 'M' and 'B' constituted a trust in respect of a sum of Rs. 11 lakhs. Clause (2) of the trust deed said that it was created for giving help or relief to such poor Vaishya Hindus or other Hindus as the trustees might consider deserving of help. Clause (3) (a) of the trust deed provided the conditions and directions to be observed and followed by the trustees in the execution of the trust. The questions that arose out of decision of the High Court were whether the trustees constituted an assessable unit under the provisions of Act, and, whether properties held by the trustees were held for any public purpose of charitable or religious nature within the meaning of section 5(1)(i). HELD Section 5(1)(i) proceeds on the basis that a trust property comes within the scope of the Act. Section 3 does bring within its scope an individual which expression in view of the Central General Clauses Act, includes individuals as well, unless the context otherwise indicates. In this case, the context, far from not indicating that the individual does not include individuals, clearly shows at any rate so far as the trustees are concerned that it include individuals. As the Indian Income-tax Act provides for the assessment of 'an association of persons', the context therein may indicate that individual does not include individuals. But such an interpretation is not permissible when dealing with section 3 of the Act. Therefore, trustees of the trust, in the instant case, constituted an assessable unit under the provisions of the Act. So far as question whether the trust could be considered as a trust created for public purpose of charitable or religious nature was concerned, it was…

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