9911796707
TMI Blog2014 (8) TMI 601X X X X Extracts X X X X X X X X Extracts X X X X ..... ive references have been made by the learned Income Tax Appellate Tribunal (hereinafter referred to as "Tribunal") to consider the following common question of law. "Whether on the facts and law and in the circumstances of the case, the Tribunal was right in law in holding that income, which according to the Trust Deed was required to be allocated to the Ten beneficiaries of the Second Schedule of the Trust Deed, having aggregate beneficial share of 50%, was liable to be taxed at maximum marginal rate u/s.164 of the I.T. Act?" 3. That the facts leading to the present references in nutshell are as under: 3.1 That one Shri Babubhai Ishwarbhai Patel settled Trust Deed dated 04.06.1980 appointing three persons viz. (1) Shri Karsanbhai K. Pat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .No. Name of Beneficiary Share of Beneficiary 1 Minor Kalpna Bhagwandas 5% 2 Minor Mahesh Bhagwandas 5% 3 Minor Lalo Bhagwandas 5% 4 Minor Devila Prabhudas Patel 5% 5 Minor Savita Prabhudas Patel 5% 6 Minor Hitesh Prabhudas Patel 5% 7 Minor Nitesh Prabhudas Patel 5% 8 Minor Janak Pramodbhai Patel 5% 9 Minor Sangita Jagdishbhai 5% 10 Minor Alkesh Jagdishbhai 5% Total: 50.00% K.V. Patel Family Trust Schedule-II forming part of this Trust Deed vide Clause III(b)(ii) (50.0% of Income) Sr.No. Name of Beneficiary Share of Beneficiary 1 Minor Kalpna Bhagwandas 5% 2 Minor Mahesh Bhagwandas 5% 3 Minor Lalo Bhagwandas 5% 4 Minor Devila Prabhudas Patel 5% 5 Minor Savita Prabhudas Patel 5% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rders for both the years i.e. 1982-83 and 1983-84 and directed the ITO to subject the income allotted to ScheduleII to tax at the maximum marginal rate in the hands of the Trustees and to take consequential action for the levy of statutory interest under section 139 etc. That the assessee preferred appeals before the learned Tribunal and the learned Tribunal has dismissed both the appeals of the assessee and thereafter at the instance of the assessee, present reference application being Income Tax Reference Application No.67/2005 is made. However, in the subsequent year for AY 1984-85 and 1985-86, the learned Tribunal took the contrary view and held that the assessee Trust is a specific Trust and therefore, at the instance of the Revenue th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing on behalf of the respective parties and considering the Trust Deed more particularly the share allotted to the respective beneficiaries - Schedule-I and Schedule-II, it appears that the shares which are allotted to the respective beneficiaries even with respect to Schedule-I and Schedule-II are specific shares and therefore, the same can be said to be determinative shares. Merely because 50% of the income and their respective shares were to be accumulated as a special fund in the hands of the trustees for 19 years and the same were to be paid after a period of 19 years, it cannot be said that the Trust is discretionary Trust and/or the Trust is not a specific Trust. In the facts and circumstances of the case and the specific percentage ..... X X X X Extracts X X X X X X X X Extracts X X X X
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