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TMI Blog1968 (11) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... pectively as gross dividends derived from certain shares he had held. The particulars of these shares are as follows: 1. Associated Hotels of India Ltd. ... 1,09,606 shares 2. Northern India Caterers Ltd. ... 20 shares 3. Oberoi Hotels (I) Ltd. ... 10 shares The Income-tax Officer found that besides these shares, the assessee's wife and two sons held certain shares of the Associated Hotels of India Ltd and the Northern India Caterers Ltd. and he included the gross dividends thereof for the year 1953-54 and the net dividends thereof for the year 1934-55 in the total income of the assessee. The particulars of these shares are as under: Year Name of shareholders Gross Dividend 1953-54 Rs. 1. Smt I. D. Oberoi, wife of the assessee (a) 15,886 shares of Associated Hotels (I) Ltd. ... 3,974.00 (b) 30 shares of Northern India Caterers Ltd. ... 15,273.00 2. Mr. T. R. Oberoi, son of the assessee : (a) 50 shares of Northern India Caterers Ltd. ... 25,454.00 (b) 6,823 shares of Associated Hotels (I) Ltd ... 1,706.00 3. Mr. P.R.S. Oberoi, son of the assessee : (a) Northern India Caterers Ltd. (20 shares) ... 10,182.00 ------------------------- Rs. 56,86.00 -- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assistant Commissioner, " H " Range, in these premises, came to the conclusion that the assessee was the real owner of the shares while his wife and sons were his benamidars. Before the Tribunal the assessee contended that the Income-tax Investigation Commission considered only the shares of the Associated Hotels of India Ltd., but the bulk of the dividend included, in the instant case, in the assessee's income was the dividend declared by the Northern India Caterers Ltd. The assessee also contended that the finality of findings of the Income-tax Investigation Commission was confined to the proceedings for particular assessment years under the provisions of section 8(2) of the Income-tax Investigation Commission Act. The assessee contended further that assuming that the shares in question were acquired out of the assessee's secreted profits in 1943 as found by the Commission, Mrs. Oberoi and the two sons were the registered holders of these shares and the dividend income, therefore, could only be in the hands of these registered holders. The Tribunal has considered the Supreme Court's judgment in Howrah Trading Co. Ltd. v. Commissioner, of Income-tax and has observed that as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f shares can never be taxed. It means that the real owner, holding a blank transfer, is not entitled to grossing up under section 16(2) and to claim the tax deducted at source under section 18(5). The Supreme Court itself has cleared up the position by its decision in Kishanchand Lunidasing Bajaj v. Commissioner of Income-tax. In this decision the Supreme Court has stated that the scheme of " grossing up " is not susceptible to the interpretation that the income from dividend is to be regarded as the income only of the registered holder and not of the real owner of the shares. The Supreme Court has held in this case that where shares acquired with the funds of a Hindu undivided family were held in the name of a karta, the Hindu undivided family could be assessed to tax tinder the Indian Income-tax Act, 1922, on the dividends from those shares. It seems, therefore, that the decision of the Supreme Court in the case of Howrah Trading Co. Ltd. is of no assistance in answering the question framed in this reference. Mr. Debi Pal, learned counsel for the assessee, has urged before us that, in any event, the Tribunal has found that the wife and the two sons of the assessee were not th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rofits. In Commissioner of Income-tax v. Scindia Steam Navigation Co. Ltd. the Supreme Court has observed : " Section 66(1) speaks of a question of law that arises out of the order of the Tribunal. Now a question of law might be a simple one, having its impact at one point, or it may be a complex one, trenching over an area with approaches leading to different points therein. Such a question might involve more than one aspect, requiring to be tackled from different standpoints. All that section 66(1) requires is that the question of law which is referred to the court for decision and which the court is to decide must be the question which was in issue before the Tribunal. Where the question itself was under issue, there is no further limitation imposed by the section that the reference should be limited to those aspects of the question which had been argued before the Tribunal. It will be an over-refinement of the position to hold that each aspect of a question is itself a distinct question for the purpose of section 66(1) of the Act." The Supreme Court reiterated these principles in one of its recent decisions in Bhanji Bagawandas v. Commissioner of Income-tax. In the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t benami. But, this burden has not, in this reference, been discharged by any of the persons concerned. The Patna High Court, applying the Judicial Committee's aforesaid decisions, has rightly pointed out (if we may say so with great respect) in Satyadeo Prasad v. Sot. Chander Joti, that if the purchase is made in the name of wife or sons the presumption of Hindu law is in favour of its being a benami purchase and the burden of proof lies on the party in whose name it was purchased to prove that he was solely entitled to the legal and beneficial interest in such purchased estate. In this judgment the Patna High Court has also referred to its earlier decision in Hazaribagh Mica Mining Co. Ltd. v. Ashalata Kapoor, on which Mr. Debi Pal has relied. In the earlier judgment also, the Patna High Court said: " ........ In the English law, a gift to a wife is presumed where money belonging to the husband is deposited at a bank in the name of a wife, or where a deposit is made in the joint names of both husband and wife. In India, the English law as to presumption of advancement has not been adopted ...... In the second place, the presumption of resulting trust may also be rebutted by p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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