Law:

Section:

Section 4, read with section 22, of the Income-tax Act, 1961 - Income - Assessable as - Assessment years 1980-81 and 1981-82 - Assessee had transferred her share in a property to a trust and though no conveyance deed was registered, income from said property was assessed in hands of trust - Whether same income from same property can be taxed twice in hands of two different persons - Held, no - Whether, therefore, assessment of income from aforesaid property was not justified in assessee's hands -Held, yes FACTS The assessee had one-half share in a property. The other co-owner R by her will dedicated the property to B trust. Subsequently, the other half-owned by the assessee was also given to the said trust by a deed of declaration dated 3-12-1977. The trust became the owner by the declaration for which the conveyance deed was executed and registered much later and not in the assessment years in question. During the assessment years 1980-81 and 1981-82, the assessee did not show any income from the property. The ITO, following his order for the assessment year 1978-79, assessed the assessee's half share of income from the said property in the assessee's hands. On appeal, the Commissioner upheld the order of the ITO. On further appeal, the Tribunal found that as the trust immediately on taking over the possession of the property had disclosed the rent in the assessment which was duly assessed by the ITO, the same income could not be taxed twice in the hands of two assessees. It, therefore, deleted the income from the aforesaid property from the assessee's assessment. On reference: HELD The ITO had assessed the trust in respect of the income from half portion of the property in respect of which assessment had already made upon the assessee with regard to his half portion of the property. Thus, the ITO taxed twice the same income with regard to same property in the hands of two different persons. The ITO had no jurisdiction to impose tax in respect of the same property and in respect of the same income twice. Thus, the Tribunal was justified in deleting the income from the said property from the assessee's assessment. CASE REFERRED TO CIT v. Ganga Properties Ltd.…

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