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TMI Blog1968 (10) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... gifted different immovable properties mentioned in the relevant gift deed to each of his five sons. At the time of these gifts, three of the sons were minors and in their cases, the gifts were accepted by the mother as the guardian, of the three minor sons. The major sons themselves accepted the gifts on their behalf. In each of the five gift deeds certain conditions were laid down by the deceased. Two of the three minor sons, Badruddin and Shabuddin, were required to bear the maintenance expenses of the mother in equal shares. The third minor son, Rajabali, was required to bear the maintenance, education and marriage expenses of his sister, Nasif. Kikabhai and Sadaqali were required to bear the maintenance, education and marriage expenses of two other daughters of the deceased. In addition, the elder son, Kikabhai, was also required to allow the deceased to continue to carry on his business in one of the buildings, which Kikabhai received under the gift deed in his favour. After the death of the deceased, while computing the principal value of the estate left by the deceased, the Assistant Controller included a sum of Rs. 1,75,000 as the value of the different properties includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illing the conditions stated above. In the remaining four gift deeds, the provision for the maintenance, education and marriage expenses of the other daughters of the donor is mentioned in exactly the same language as the passage we have cited above from the gift deed in Kikabhai's favour ; and so far as the wife of the donor, Sultanbu, is concerned, in the case of two minor sons, the condition was that they had to bear the appropriate expenses for their mother, Sultanbu, till she survived ; and each of the five gift deeds makes it abundantly clear that the gift deeds were being executed subject to these conditions in favour of the persons concerned. Under Mahomedan law, a gift with a condition is recognized and it has been stated in Mulla's Principles of Mahomedan Law, 16th edition, at page 155, section 164, that when a gift is made subject to a condition which derogates from the completeness of the grant, the condition is void, and the gift will take effect as if no conditions were attached to it. It has also been stated at page 157, section 165 : " Where property is transferred by way of gift, and the donor does not reserve dominion over the corpus of the property nor any sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cannot be said that there is any derogation from the completeness of the grant because the donor did not reserve any dominion over the corpus of the property nor did he reserve any power over the dominion of the corpus but only stipulated that the shop should be allowed to run on the premises where it had been running in the past. Under these circumstances, that particular condition in the gift deed in Kikabhal's favour is a valid condition. The question then arises whether, under any of the provisions of the Act, the immovable properties included in these different gift deeds can be said to have so passed under any of the provisions of the Act, Regarding the condition of the user of the, shop in the gift deed in favour of Kikabhai, at the first blush it may appear that by the condition regarding the user of the ground-floor premises for the purposes of the shop, the donor was not entirely excluded from possession and enjoyment of this particular property under the gift deed and, the provisions of section 10 of the Act would be attracted. But it has to be borne in mind that there must be a passing of the property on the death of the settlor either under the provisions of sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nance of wife is also included in this Chapter but section 365 indicates that this topic has been dealt with under section 277 to section 279. Thus, so far as the principles of Mohamedan law are concerned, maintenance to be provided is in respect of food, raiment and lodging. Unlike the provisions contained in Hindu law under which a Hindu father is bound to maintain from the joint family property his unmarried daughters till their marriage and also to provide for their marriage expenses, there does not appear to be any provision under Mohamedan law under which there is an obligation on the father to provide for the marriage expenses of the daughter. Similarly there does not appear to be any obligation on the father to provide for the expenses for the education of the daughters. The only obligation under Mahomedan law is to provide for maintenance, which includes food, raiment and lodging for the unmarried daughters till they get married and for the wife. It is clear, therefore, that by making these provisions in each of the five gift deeds for the maintenance of his wife, Sultanbu, and for the maintenance till marriage of the three unmarried daughters the donor in each of the five ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ill remains whether the Explanation to section 12 would apply to such conditions. It is clear that there is no provision for the maintenance of the donor himself in this particular case and in each case there is only provision for the maintenance of one of the relatives, viz., either the daughter or the wife in each of the five gift deeds. The words : " for the maintenance of himself and any of his relatives " cannot be read to mean " for the maintenance of himself or for the maintenance of any of his relatives because if there is provision for the maintenance of the donor himself, there is no necessity to invoke the Explanation to section 12 and the word " and " occurring in this phrase cannot be read to mean " or " because in that event there is no necessity for the legislature to provide " for the maintenance of himself ". In the context in which this phrase occurs in the Explanation to section 12, it is clear that what the legislature intended to provide for and has in fact provided for is a clause whereby the settlor provides for the maintenance of himself and any of his relatives, i.e., there must be provision for the joint maintenance of the settlor himself and any of his re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... till her death in the case of Sultanbu, the wife of the donor. Therefore, in our opinion, it is difficult to apply the provisions of section 12 to these gift deeds and to include the value of the properties covered by the five gift deeds as that of the value of the properties deemed to pass under section 12. Once it is held that the Explanation to section 12 is not applicable, it is clear that simply by making provision for the maintenance of his relatives, the donor cannot be deemed to have reserved an interest for himself and the relevant clause in each of the trust deeds is to be looked at purely from the point of view of determinability with reference to the death of the deceased under sub-section (1) of section 12. In our opinion, section 12(1) cannot apply and we have to consider whether the case falls under any of the other provisions of the Act. Section 10 of the Act, which has been relied upon by the revenue, states that property taken under any gift, whenever made, shall be deemed to pass on the donor's death to the extent that bona fide possession and enjoyment of it was not immediately assumed by the donee and thenceforward retained to the entire exclusion of the donor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the same manner and as fully and in all respect as if, he were not a trustee thereof. The testator continued to manage the trust property until his death, receiving certain varying sums annually as remuneration, and after deducting those and other outgoings and expenses he divided the profits from the property into five equal shares, crediting one share to himself and one share to each of his children. The children's shares, he applied during their minority for their maintenance and education, and paid them to the children when they came of age. The relevant contention regarding the maintenance of the minor children is dealt with in the report at page 72 thus : " But the statute requires not only exclusion of the donor but also exclusion of any benefit to him, and it was on that matter that the argument turned. It appears from the case that after the children came of age they received payment of their shares of the income ; it is not said that that involved any benefit to the deceased. But before they came of age their shares of income were used to pay for their maintenance and education, and it was said that this afforded some relief to the deceased, who would otherwise have ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to him of whatsoever kind or in any way whatsoever. It is possible that in the consideration of this very difficult part of the sub-section it may be pertinent in some cases to inquire whether the benefit derived by the donor is one that impairs or detracts from the donee's enjoyment of the gift. Their Lordships, with great respect, think that this is a matter which may require further examination, but, as they have already said, they are clearly of opinion that it is not a relevant consideration whether the question arises under the first limb of the sub-section and is whether the donor has been entirely excluded from the subject-matter of the gift..." And it was indicated in that case that, in that particular case, they were not concerned with the second limb of the sub-section. It is true that in Oakes's case, Lord Reid stated : "...... but their Lordships will assume that there was some advantage to the deceased ; but that advantage was not at the expense of the children and did not impair or diminish the value of the gift to them or their enjoyment of it. It is possible for a donee, in the full and unrestrained enjoyment of his gift to use or spend it in a way that happens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 102(2)(d) of the Stamp Duties Act of Australia corresponded with section 11(1) of the United Kingdom Customs and Inland Revenue Act, 1889, and section 43(2)(a) of the United Kingdom Finance Act, 1940. Mr. Sheth, for the accountable person, contended before us that, even if the property covered by the gift can be deemed to pass on the donor's death under section 10 because of the non-exclusion of the benefit to the donor, it must be deemed to pass only to the extent of the benefit and not to the extent of the full value of the property. He contended that the Indian legislature has deliberately departed from similar provisions of the English and Australian statutes by providing that property shall be deemed to pass on the donor's death to the extent of the benefit, possession, etc. We must make it clear that, in the instant case, we are only concerned with the second limb of the second part of section 10 and we have to consider in the instant case whether any of the properties included in the relevant gift has been indicated with precision or specification, for providing maintenance for the wife or the unmarried daughters. It is if there is any such specification or setting apart of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in George Da Costa v. Controller of Estate Duty, that the whole of the property, where the shop premises are situated, would be includible in the total value of the estate of the deceased. In George Da Costa's case the Supreme Court has pointed out that the crux of section 10 lies in two parts : (1) the donee must bona fide have assumed possession and enjoyment of the property, which is the subject-matter of the gift, to the exclusion of the donor, immediately upon the gift, and (2) the donee must have retained such possession and enjoyment of the property to the entire exclusion of the donor or of any benefit to him, by contract or otherwise. The Supreme Court took the view that,as a matter of construction, both these conditions are cumulative. Unless each of these conditions is satisfied, the property would be liable to estate duty under section 10 of the Act. The Supreme Court further pointed out that the second part of the section has two limbs : the deceased must be entirely excluded, (i) from the property, and (ii) from any benefit by contract or otherwise. In the instant case, so far as the shop premises are concerned, the second limb of the second part of the section is n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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