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Section 2(xii) of the Gift-tax Act, 1958 - Gift - Assessment year 1988-89 - Whether immovable property gifted by a Christian father to her daughter at time of her marriage is a taxable 'gift' - Held, yes FACTS The assessee,who owned certain rubber estate, gifted part of it to his daughter at the time of her marriage. For the assessment year 1988-89, the assessee filed a return of gift declaring certain taxable gift. The assessing authority did not accept the said valuation. He estimated the value of the gifted property. After giving the basic deduction allowable under section 5 and the further deduction under section 5(1)(vii), the taxable gift was determined. On appeal, the assessee contended before the Deputy Commissioner (Appeals) that the gift in question was completely exempted from gift-tax. The appellate authority decided that the gift made by the assessee to his daughter was a taxable gift. He did not also accept the contention of the assessee regarding the value of the property. On second appeal, the Tribunal took the view that by gifting the property, the Christian father was discharging his obligation in connection with the marriage of his daughter and, accordingly, held that the gift in question was not exigible to tax under the Act. On reference : HELD It was clear that the question raised in the instant case was squarely covered by the decision in CGT v. M.C. George [2002] 253 ITR 363wherein it was clearly held by the Court that the obligation of the Christian father to maintain his daughter obviously ceases when he has given her away in marriage. Following the said decision, it was to be held that the property gifted by the father to his daughter could be viewed as 'gift' within the meaning of the Act not entitled to exemption. The Tribunal was directed to consider the question of valuation of gift while passing orders as contemplated under section 26(1) of the Act. CASES REFERRED TO Smt. Indira Devi v. GTO [GT Appeal Nos. 12 and 34 (Coch.) of 1986, dated 13-5-1991], Scariah Varghese v. Marykuty 1991 (2) KLJ 26, CGT v. Smt. B. Indira Devi [1999] 238 ITR 846 (Ker.), CIT v. P.M. Paily Pillai [1972] 86 ITR 516 (Ker.) (FB) and CGT v. M.C. George…

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