1971 (11) TMI 31

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..... ry business by the assessee to Kuriappan amounts to a valid gift for the lifetime of the assessee ? If the gift is valid for the lifetime of the assessee, what is the nature of the interest gifted and how is it to be valued ? " The reference relates co the assessment year 1964-65. On April 1, 1963, the assessee transferred without any consideration a stationery business called M/s. C. M. Joseph and Sons, Trichur, with all its assets and liabilities including the goodwill to her son, C. I. Kuriappan called Baby. The Gift-tax Officer estimated the value of the business at Rs. 72,446 and the value of goodwill at Rs. 13,070. He assessed to gift-tax a total value of Rs. 85,516. The plea of the assessee was that under the terms of the gift, what .....

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..... he same. Even if the assessee is an executrix under the will, the question arises whether any interest in her favour has been created by the testator in the properties comprised in the will. The operative portion of the will is extracted in the order of the Tribunal, annexure " D ", as follows: " In the event of my death, my wife, Kunjharam, daughter of Porathoor Ittiachan, is to keep possession of all the above said assets, business etc., and to run the same herself or through others, but without the right to encumber or alienate the assets and with the income she is to meet the family expenses. On the death of my wife, Kunjharam, if Baby alias Kuriappan is a major, he is to be given properties worth Rs. 16,000 out of the assets and if h .....

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..... ore the same by the assessee. According to the decision in Commissioner of Income-tax v. Scindia Steam Navigation Co. Ltd. it is only a question that has been raised or decided by the Tribunal that could be held to arise out of its order. But, when the Tribunal has found that only life interest of the assessee in the properties is comprised in the gift deed, the valuation of the same is an aspect of that question. In the light of the decision in Bhanji Bagawandas v. Commissioner of Income-tax, it is open to us to consider the same. We, therefore, hold that the gift-tax to be levied should be on the value of the life interest of the assessee in the properties comprised in the gift deed. We, therefore, answer question No. (i) in the negative, .....

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