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TMI Blog2015 (8) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... 5, 1970, determining the market value at Rs. 2.87 per square yard. A sum of Rs. 1,02,068 was paid on the same day and possession was taken. At the instance of the applicant, a reference under section 18 of the Act was made to the Subordinate Court, Visakhapatnam and it was taken up as O. P. No. 59 of 1971. The trail court passed a decree dated February 5, 1974, enhancing the market value to Rs. 20 per square yard, which aggregated to Rs. 6,93,187. About two years thereafter, i.e., on April 26, 1976, the applicant created a trust for the members of his family and for charity. He endowed a sum of Rs. 1,000 initially and made a provision for transfer of the amount receivable under the decree passed in O. P. No. 59 of 1971 and the further appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereupon, the applicant filed I. T. A. Nos. 956/ Hyd/92 and GTA. No.8/H/92 before the Income-tax Appellate Tribunal, Hyderabad Bench. Through separate orders, dated May 26, 1998, the Tribunal dismissed both the appeals. The applicant filed common reference application in both the appeals before the Tribunal with a request to refer certain questions to this court covering both the appeals. After hearing both the parties and undertaking extensive discussion, the Tribunal referred the following question for answer to this court : "Whether, on the facts and in the circumstances of the case, the entire amount of award received by the assessee, shown in his books of account as liability of the trust does not amount to income of the assessee lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 345 (SC), that of the Bombay High Court in Akber A. Dehgamwalla v. CWT [1992] 195 ITR 17 (Bom) and that of the Karnataka High Court in C. N. Nagakumar v. CWT [1992] 195 ITR 844 (Karn). Learned standing counsel for the Department, on the other hand, submits that it is only an amount, which is definite and available at the relevant point of time, that can be gifted and not something, which is uncertain. He submits that what was gifted by the applicant to the trust was not the amount of compensation but only the one which is the subject matter of an O. P. and further appeal and such parcels cannot be gifted at all. He submits that all the authorities under the Act have taken a correct view of the matter and both the questions deserve to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decreed hereinabove referred and also transfers unto the trustees a sum of Rs. 1,000 (rupees one thousand only) in cash, as initially corpus fund to the trust and the right too the entire compensation which is the subject matter of A. S. No. 56 of 1976 on the file of the High Court or to any lesser sum that will be receivable on and after the decision of the High Court is rendered and for this purpose the settler is so advised will have the trust impleaded as a party in the appeal proceedings in the High Court of Andhra Pradesh being an assignee of the right under this trust." Between the date of trust deed and April 25, 1977, the applicant received a sum of Rs. 4,00,000 on the basis of the interim order passed by this court in A. S. No. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' means a claim to any debt, other than a debt not secured by mortgage of immovable property or by hypothecation or pledge of movable property, or to beneficial interest in movable property not in the possession, either actual or constructive of the claimant, which the civil courts recognise as affording grounds for relief, whether such debt or beneficial interest be existent, accruing, conditional or contingent." From a perusal of this, it becomes clear that any amount representing debt other than the one secured by mortgage or hypothecation need not be in actual or constructive possession of the claimant. In the ultimate analysis, it is a right to claim the amount. However, the right must be clear and a definite one. The remote possi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eing gifted. The judgment in Mrs. Khorshed Shapoor Chenai's case (supra) arose under the Estate Duty Act. The Supreme Court took the view that the compensation for the land, which is acquired under the Act cannot be treated as part of estate of an assessee, and his right to receive compensation at market value as on the date of notification that may accrue to him can certainly be treated as a property, that would pass on, on his death. In other words, the right to receive compensation was treated as an item of property. Similar view was expressed in Smt. Anjamli Khan's cases (supra). Therefore, the view taken by the Assessing officer, the Commissioner and the Tribunal in the instant case that the right to receive enhanced compensa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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