Law: Estate Duty Act, 1953

Section: 10,64(1)

FACTS The donor created a Trust settling certain shares specified therein for the benefit of his grandson. The trust deed provided that by a unanimous resolution each of the trustees may, out of the income of the trust property, receive remuneration maximum upto Rs. 3,000 per annum for services rendered by them. The Assessing Officer included the entire corpus of the trust at the time of death of the donor in his dutiable estate under section 10. On appeal, the Appellate Controller affirmed the order of the Assessing Officer. On second appeal, the Tribunal held that section 10 was not applicable in the instant case. On reference, the High Court reversed the order of the Tribunal and held that section 10 was attracted. On appeal: HELD The indenture of trust quite clearly provided that the shares had been transferred unconditionally under the deed of trust to the trustees for the benefit of the grandson of the donor. The gift under the trust deed of the shares was absolute. The donor had not reserved any right or interest to himself in the gifted property under the deed of trust. The only clause on which the revenue had relied was a clause which provided that the trustees may, by unanimous resolution, provide for any remuneration to themselves subject to a maximum of Rs. 3,000 per annum. This referred to a subsequent act of the trustees. It did not, in any manner, make the settlement of shares conditional. Moreover, in the instant case, no such resolution was ever passed nor was any remuneration received by any of the trustees including the donor who was one of the trustees. In these circumstances, the provisions of section 10 were not attracted and the corpus of the trust fund was not liable to be included in the estate of the deceased. CASE REVIEW Sarojini Ammal v. CED [1996] 222 ITR 408/ 88 Taxman 351 (SC) affirmed. Norman Clyde Oakes v. Commissioner of Stamp Duties of New South Wales [1954] 26 ITR (Suppl.) 1 (PC) held not applicable. CASES REFERRED TO Sarojini Ammal v. CED [1996] 222 ITR 408/ 88 Taxman 351 (SC) and Norman Clyde Oakes v. Commissioner of Stamp Duties of New South Wales[1954] 26 ITR (Suppl.) 1 (PC). JUDGMENT 1. The following question was…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492