2001 PLP 978 (PTD)
COMMISSIONER OF WEALTH TAX Versus M. K. CHANDRAKANTH
| Citation | 2001 PLP 978 (PTD) |
| Forum / Court | 240 I T R 491 |
| Bench Members | N. V. Balasubramanian and P. Thangavel, JJ |
| Parties | COMMISSIONER OF WEALTH TAX Versus M. K. CHANDRAKANTH |
| Primary Law | Wealth tax |
Q1: What are the key laws and sections cited in 2001 PLP 978 (PTD)?
This judgment primarily cites: Wealth tax as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2001 PLP 978 (PTD)?
The case was heard and decided by the 240 I T R 491 bench comprising: N. V. Balasubramanian and P. Thangavel, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2001 PLP 978 (PTD) (COMMISSIONER OF WEALTH TAX Versus M. K. CHANDRAKANTH). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Headnotes / Summary
Net wealth
Inclusions in net wealth
Assets transferred td minor child
Trust for benefit of minor child
Trust held irrevocable by High Court
Contributions to trust were not includible in net wealth of assessee-- Indian Wealth Tax Act, 1957, S.4. Held, that the High Court in CIT v. M.K. Chandrakanth (1997) 225 ITR 101 (Mad.), considered the relevant terms of deeds of trust, both of the M.C. Shyamala Marriage Benefit Trust and M.C. Sowmyaram Marriage Benefit Trust and held that the busts were irrevocable trusts. Though the decision was rendered under the provisions of the Income-tax Act the principles laid down in the said decision would be equally applicable fog consideration of the question under the Wealth Tax Act. Since the High Court had already held that the trusts were irrevocable trusts, the provision; of section 4(1)(a)(iv) of the Wealth Tax Act, 1957, could not be applied and contributions made by the assessee to the trusts could not be included in the assessment years 1980-81 and 1981-82. CIT v. M.K. Chandrakanth (1997) 225 ITR 101 (Mad.) applied. C.V. Rajan for the Commissioner. R. Meenakshisundaram for the Assesses.
Judgment & Decree
CIT v. M.K. Chandrakanth (1997) 225 ITR 101 (Mad.) applied. C.V. Rajan for the Commissioner. R. Meenakshisundaram for the Assesses. N. V. BALASUBRAMANIAN, J.‑‑‑At the instance of the Department, the Income‑tax Appellate Tribunal, has stated a case and referred the following common question of law under section 27(1) of the Wealth Tax Act, 1957, for our opinion: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was correct in holding that the contributions made by the assessee to the trusts should not be included in the net wealth under section 4(1)(a) of the Wealth Tax Act, 1957?" The assessee is an individual. He transferred certain amounts of M.C. Shyamala Marriage Benefit Trust and M.C. Sowmyaram Marriage Benefit Trust. The Wealth Tax Officer in the assessment proceedings for the assessment years 1980‑81 and 1981‑82 held that the trusts were revocable trusts and, therefore, the amount transferred should be included under section 4(1)(a)(iv) of the Wealth Tax and made additions of Rs. 1,43,960 and Rs. 1,69,873 respectively for the assessment years 1980‑81 and 1981‑
82. The Commissioner of Wealth Tax (Appeals) following an earlier order of the Tribunal in the assessee's own case held that the trusts were irrevocable trusts and, therefore, the provisions of section 4(1)(a)(iv) of the Act cannot be applied. The Appellate Tribunal on appeal by the Revenue, also confirmed the order of the Commissioner of Wealth Tax (Appeals). It is this order of the Appellate Tribunal that is the subject‑matter of this tax case. Mr. C.V. Rajan, learned counsel for the Revenue, brought to our notice the decision of this Court in the case of CIT v. M.K. Chandrakanth (1997) 225 ITR 101, wherein this Court considered the relevant terms of the deeds of trusts both of the M.C. Shyamala Marriage Benefit Trust and M.C. Sowmyaram Marriage Benefit Trust and held that the trusts are irrevocable trusts. Though the decision was rendered under the provisions of the Income tax Act, the principles laid down in the said decision would be equally applicable for consideration of the question under the Wealth Tax Act. Since this Court has already held that the trusts are irrevocable trusts, we are of the view that the provisions of section 4(1)(a)(iv) of the Wealth Tax Act, cannot be applied and the Tribunal has come to the correct conclusion in holding that the contributions made by the assessee to the trusts cannot be included in' the assessment years 1980‑81 and 1981‑
82. We hold that there is no infirmity in the order of the Appellate Tribunal, and, accordingly, we answer the common question of law referred to us in the affirmative and against the Revenue. No costs. M.B.A./406/FC Reference answered.