1986 (10) TMI 87 - AT - Income Tax

Summary

Issues:
1. Whether the gift of 3 acres of agricultural land to the daughter on the occasion of her marriage is liable to gift-tax.
2. Whether the obligation on the mother to maintain her daughter includes the gift of property on the occasion of marriage.

Analysis:
1. The case involved the gifting of 3 acres of agricultural land by the assessee to her daughter on the daughter's marriage. The Gift Tax Officer (GTO) imposed gift-tax, which was later contested by the assessee. The Appellate Assistant Commissioner (AAC) ruled in favor of the assessee, stating that no chargeable gift was involved. The revenue appealed this decision.

2. The departmental representative argued that there was no obligation on the mother to gift property during her daughter's marriage, as it was traditionally the father's duty. However, the assessee's counsel highlighted the custom in the Kamma community to gift land at the time of a daughter's marriage. The possession of the land was transferred at the time of marriage, supporting the claim that the gift was not taxable under the Gift-tax Act, 1958.

3. The tribunal considered the submissions and noted the cultural practice in the Kamma community of gifting land during marriages. Referring to legal precedents, the tribunal emphasized that the gift was given in recognition of the daughter's right and as part of the family's obligation, rather than a voluntary gift. The possession of the land was transferred at the time of marriage, reinforcing the connection between the gift and the marriage ceremony.

4. The tribunal rejected the revenue's argument that there was no obligation on the mother to make a gift, citing legal sources that establish the obligation of both parents to maintain their children. The tribunal referenced legal texts and previous judgments to support the view that the mother, under Hindu law, also has a duty to maintain her daughter, including providing for her marriage expenses.

5. Further, the tribunal analyzed the Hindu Adoptions and Maintenance Act, highlighting provisions that recognize the obligation to incur expenses related to a daughter's marriage as part of maintenance. Legal interpretations and court decisions were referenced to establish that the gift of property on the occasion of a daughter's marriage is not considered a taxable gift but rather a fulfillment of the legal obligation to maintain and support the daughter.

6. Ultimately, the tribunal dismissed the revenue's appeal, affirming that the gift of 3 acres of land by the mother to her daughter on the occasion of her marriage was not subject to gift-tax. The tribunal concluded that the gift was made in discharge of the mother's legal obligation and in accordance with the customs of the community, therefore not constituting a chargeable gift under the law.