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TMI Blog1983 (7) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... und floor bears D. No. 6-2-953/A whereas the first floor bears D. No. 6-2-953/Al. For purposes of constructing the first floor, the assessee raised a loan of Rs. 85,000 from the Syndicate Bank. Now the first floor only is the asset with which we are concerned in these appeals. The wealth-tax appeal relates to the assessment year 1976-77 for which the valuation date was 31-3-1976. The construction of the first floor was in progress during the assessment year 1975-76. In the assessment relating to that assessment year, viz., 1975-76, the assessee showed an investment of Rs. 60,000 for construction and claimed exemption of the same towards the loan to the Syndicate Bank. However, in the return filed for the assessment year 1976-77, he did not disclose any value for the first floor on the ground that it was transferred to one Miss Hema Mohan by way of settlement deed executed on 5-11-1975 in consideration of his love and affection towards her. By the date of execution of the settlement, dated 5-11-1975, except there was an understanding that the settlor and the settlee are going to marry on a future date there is no other relationship. Copy of the settlement deed was filed before us. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... position applies to the facts of the assessee's case. The WTO directed the assessee to produce before him the original of the registered document. The authorised representative for the assessee at that time expressed his inability to produce the original document inasmuch as the document was withheld by the Sub-Registrar for want of certificate under section 230A of the Act. Then the WTO ascertained the stage at which the document was lying with the Sub-Registrar. He also asked the assessee to give the exact date on which the document was presented and further asked him to produce the acknowledgment in token of filing the settlement deed. It is recorded in the assessment order that the assessee could not enlighten him on those points due to lapse of time. The WTO held that there, was no valid registered document transferring the property before 14-12-1975, the date on which the assessee married Miss Hema Mohan and so she did not become the owner of the property before her marriage under any circumstances. Therefore, be included the value of this asset in the wealth of the assessee and completed the assessment by his order dated 28-3-1981. 3. Aggrieved by the said order, the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Aggrieved both against the appellate orders mentioned above, the revenue came up in second appeal before this Tribunal and thus both matters stand for our consideration. 5. According to the department the matter was concluded by the decision of the Gujarat High Court in the case of Darbar Shivrajkumar v. CGT [1981] 131 ITR 647. As per the head note of the decision the Gujarat High Court held the law as to the incidence of gift-tax liability as follows : " On a combined reading of sections 122 and 123 of the Transfer of Property Act, 1882, it is evident that a transaction of a gift of immovable property would be complete only by executing a registered document subject to other conditions being fulfilled. The transaction would not be complete and a gift in the eye of law cannot be made by the donor to the donee prior to the registration of the document by which the gift was made. The title of the transferee does not relate back to the date of the execution of the gift deed. Therefore, the liability to pay tax on the gift must be determined as on the date on which the gift deed was registered under section 47 of the Registration Act, 1908, and not the date on which the deed of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts that both the parties proceed on the basis that the ratio of the Supreme Court decision in Philip John Plasket Thomas's case, wherein it was laid down that the relationship of husband and wife must subsist not only at the time of accrual of income from the assets but also when the transfer of assets takes place in order to attract the application of section 64(1)(iv) is unexceptionable. Therefore, the date of transfer becomes very much relevant in this case. The learned counsel refers us to the latest decision of the Gujarat High Court in Arundhati Balkrishna v. CIT [1982] 138 ITR 245. In that case the vendors had signed the sale deed before 1-3-1970 but the sale deeds were not presented for registration before 1-3-1970. A great deal turned on the question whether the transaction of sale was effected prior to 1-3-1970 or subsequent to 1-3-1970. Two questions which were referred to the Gujarat High Court in that case are as under : " 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the transfers in question were not transfers effected before March 1, 1970, as contemplated in section 47(viii) of the Income-tax Act, 1961 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions reported in T. V. Kalyanasundaram Pillai v. Karuppa Mooppanar AIR 1927 PC 42 and Venkat Subba Srinivas Hegde v. Subba Rama Hegde AIR 1928 PC 86. The ratio found out from those two decisions was stated to be that a transaction of gift made by a document, which is subsequently registered, becomes operative from the date on which the document of gift was executed. The Gujarat High Court was considering the date of transfer for purposes of capital gains under section 45 of the Act. Therefore, the question in which previous year the transaction was effected was felt important for decision. Interpreting the meaning of the expression ' effected ' their Lordships held as follows : " . . . In other words, the expression ' effected ' in the context in which it is used would mean the previous year in which the transfer of a capital asset became complete or operative in the sense of the title of the transferor being extinguished and the title of the transferee being created . . . " Even for purposes of the Wealth-tax Act their Lordships felt that the date on which the transaction is effected would be extremely relevant even under the provisions of the Wealth-tax Act. Their Lordships e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... become effective from the date on which the document was executed, in case its registration is subsequently admitted before the Registrar and eventually it is registered . . ." Therefore, it is urged before us that it is the latter decision of the Gujarat High Court in Arundhati Balkrishna's case which should govern the disposal of these two appeals rather than the former decision of the Gujarat High Court in Darbar Shivrojkumar's case. Further, in order to buttress the arguments that by dint of section 47 of the Registration Act, a transfer which was executed on one date and registered on a different date takes effect from the date of execution or becomes operative from the date of execution, the learned counsel for the assessee relied upon the decision in Ramananda Paul v. Pankaj Kumar Ghosh AIR 1938 Cal. 417 where it is held that the period of three months under section 54 of the Provincial Insolvency Act in the case of mortgage deed which is compulsorily registrable commences from the date of execution of the deed and not from that of registration as the deed of registration takes effect from the former date under section 47 of the Registration Act. On the other hand, the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by means of the effect of section 47 of the Registration Act by applying the test laid down by the Supreme Court in Philip John Plasket Thomas's case the transfer in her favour had taken effect when she was not the wife of the assessee. Then in such a case section 64(1)(iv) does not apply. But, on the other hand, if the transfer is deemed to have taken place on 5-8-1982 on which date the settlement deed, dated 5-11-1975, was registered, Miss Hema Mohan had already become the wife of the assessee by that time and, hence, the transfer is squarely governed by the provisions of section 64(1)(iv). This position holds good even for wealth-tax purposes relevant for the assessment year 1977-78. We have thoroughly gone through the two decisions of the Gujarat High Court in Darbar Shivrajkumar's case and Arundhati Balkrishna's case as well as all the decisions cited and explained in the latter Gujarat High Court decisions. We are of the firm opinion that the ratio of the latter Gujarat High Court decision aptly governs this case. The ratio of the latter Gujarat High Court decisions was already extracted in the above paras and we need not reiterate it here again. In view of the said decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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