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Interpretation of settlement deed under Travancore-Cochin Agricultural Income-tax Act, 1950. Analysis: The judgment pertains to a reference under the Travancore-Cochin Agricultural Income-tax Act, 1950, concerning the revocability of a settlement deed executed by the assessee, Subramania Pillai, covering his agricultural properties. The Commissioner revised the assessment, deeming the settlement revocable under section 9(1) of the Act, making the assessee liable for the income from the settled properties. The key question referred was whether the settlement deed was revocable under the Act. The court analyzed the provisions of section 9(1) and its proviso, which deem agricultural income arising from settlements or transfers revocable if they allow the settlor to re-transfer assets or reassume power over the income or assets. The judgment distinguished between settlements where the settlor remains the property owner and those involving revocable transfers of the property itself. The proviso broadened the scope of revocable transfers to include any provision allowing the settlor to reassume control indirectly. The settlement in question allocated properties to the settlor's sons and wife, with a provision for granting stridhanam to the daughter. The crucial clause empowered the settlor to select properties for the daughter's stridhanam if the sons failed to execute the deed, indicating the settlor's authority to reassume power over the assets. The court held that this clause rendered the settlement revocable under the Act. The judgment drew parallels with the Indian Income-tax Act's provisions and precedent cases to support its interpretation. It rejected the assessee's argument citing a previous case where the settlor had no control, emphasizing the unique circumstances of the present case. Additionally, the court dismissed the application of the third proviso to section 9(1), as the settlement did not meet the conditions for exemption. The court concluded that the settlement fell within the first proviso of section 9(1) and ruled against the assessee, directing them to bear the department's costs. The judgment highlighted the settlor's power to reassume control as the determining factor in deeming the settlement revocable under the Act, emphasizing the specific clauses in the settlement deed that granted such authority.
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