Law:

Section:

Income-tax-Income -Collection for charity at specified percentage of sale price-Shown separately in bills and collected No part spent for charity -Collections whether part of income of collector-Guiding principles. The assessee collected from his customers half a per cent. of the sale price of the goods sold by him, showing them separately in the bills as for charity, though no portion of the said collection appeared to have been actually spent by the assessee toward, charity. The officer held that the collections were part of the income of the assessee brat the Tribunal held otherwise. On a reference: Held, the creation of a trust included conveyance of the ownership in the fund from the owner to the trustee and if such transfer is voluntary and with a view to constitute the sutra so transferred as a trust for a specific purpose, the collections would not form part of the income of the collector ; but if the payment made by the customers is not voluntary and not intended as a gift to charity, the collection would form part of the income of the person who received the same, notwithstanding that the same was shown separately in the bills as part of the bargain, as it would only indicate his intention to create a trust. [In the instant case, the matter was remitted to the Tribunal for fresh disposal in the light of the judgment after determina tion of the question whether the contributions were voluntary and with the intention of creating a trust making the collector the trustee thereof for a specific purpose.]                                                                                                             JUDGMENT VEERASWAMI,…