Law:

Section:

Section 2(xx) of the Gift-tax Act, 1958, read with section 3 of the Income tax Act, 1961 - Previous year - Assessee was following Samvat Year as previous year for purposes of income-tax assessment - Assessee made gifts on day of 2-2-1963 which fell in Samvat Year 2019 commencing on 29-10-1962 and ending on 17-10-1963 - Whether previous year for gifts in question should be Samvat year 2019 and assessment year should be 1964-65 - Held, yes FACTS The assessee made gifts on 2-2-1963. She filed a voluntary return for these gifts under the Act showing the assessment year as 1964-65 and the previous year as Samvat Year 2019 which commenced on 29-10-1962, and ended on 17-10-1963. On the basis of this return, the GTO carried out the assessment. The assessee, subsequently, contended before the GTO that the year of assessment for the gifts should be the year 1963-64 and not 1964-65. She, however, failed in this contention before the GTO. The AAC found that the assessment year for the gifts in question was correctly adopted as the year 1964-65. The Tribunal construed sub-clause (c) of clause (xx) of section 2 as meaning that the 'previous year' for the purpose of gift-tax should be determined by taking the event of gift as the event of earning income, and then deciding what would be the 'previous year' if the assessment of that income were to be made in the hands of the donor under the 1961 Act. It, therefore, held that the previous year should be the financial year for assessing the gifts made on 2-2-1963, and the assessment year should be 1963-64. On reference : HELD Incorporation of a provision of law in a statute by reference to a similar provision in another statute is a recognised method of legislation. Whenever such a method is adopted, the provisions of another statute to which a reference is made should be read as having been made under the statute which makes that reference. But there, the purpose of the reference ends, unless there is a clear indication that the reference is made to incorporate something more. In this case, reference to the definition of the expression 'previous year' as given in section 3 of the 1961 Act is not made for the purpose of…

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