9911796707
TMI Blog1996 (11) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... case and particularly in view of clauses 5 and 6 of the trust deed which, inter alia, provided for accumulation of income till the date of death of Prince Moazam Jah Bahadur which took place only in September, 1987, the Appellate Tribunal is correct in holding that Smt. Oolia Kulsum was the sole beneficiary as on the valuation date ? 2. Whether, on the facts and in the circumstances of the case, can it be said that the beneficiaries are known and their shares are determinate as on the valuation date relevant to the assessment year 1979-80 so as to hold that the assessment was liable to be made only under section 21(1) and not under section 21(4) of the Wealth-tax Act ?" These questions are said to arise out of the order of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d she was the only beneficiary ; therefore, it cannot be said that the beneficiaries were indeterminate or unsettled ; so, the Tribunal was right in coming to the conclusion that the assets were taxable under section 21(1) of the Act. To appreciate the contentions of learned counsel, it would be appropriate to note the contents of clauses 5 and 6 of the trust deed dated March 21, 1953. Clause 5 provides that the trustees shall hold and stand possessed of the shares specified in the second schedule upon the trusts to accumulate the income thereof up to the death of the said Prince Muazzam Jah Bahadur and on and after the death of the said Prince, to hold and stand possessed of the first share fund including the accumulations of the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share under this sub-clause shall be alive and so that persons standing in the same degree of relationship shall take between themselves in the proportion mentioned above their respective parent's share and so on from generation to generation. " Clause 6 is in similar terms as clause 5, but relates to the second shares fund. A perusal of clauses 5 and 6 of the trust deed makes it clear that the trustees were to accumulate the income till the death of Prince Muazzam Jah Bahadur which occurred on September 14, 1987, and to pay the same to Sahebzadi Oolia Kulsum only for and during her lifetime and after her death to divide the income of the first shares fund amongst her children and other issue howsoever remote, in accordance with the form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lared by a duly executed instrument in writing (including a valid deed of wakf) shall be deemed, for the purposes of this sub-section, to be a trust declared by a duly executed instrument in writing if a statement in writing, signed by the trustee or trustees, setting out the purpose or purposes of the trust, particulars as to the trustee or trustees, the beneficiary or beneficiaries and the trust property, is forwarded to the Assessing Officer,--- (i) where the trust has been declared before the 1st day of June, 1981, within a period of three months from that day ; and (ii) in any other case, within three months from the date of declaration of the trust. . . . (4) Notwithstanding anything contained in the foregoing provisions of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such family, in circumstances where such relatives or members were mainly dependent on the settlor for their support and maintenance ; or (iii) such assets are held by the trustees on behalf of a provident fund, superannuation fund, gratuity fund, pension fund or any other fund created bona fide by a person carrying on a business or profession exclusively for the benefit of persons employed in such business or profession, wealth-tax shall be charged at the rates specified in Part I of Schedule I. Explanation 1. --- For the purposes of this sub-section, the shares of the persons on whose behalf or for whose benefit any such assets are held shall be deemed to be indeterminate or unknown unless the shares of the persons on whose behalf or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble trust. But in a case of contingent interest though the number and identity of the beneficiary will be certain, definite and defined, his taking of the benefit under the trust will depend on the happening or not happening of some event which may be uncertain. The clauses, referred to above, indicate that the interest of the beneficiary, Sahebzadi Oolia Kulsum, was contingent on her being alive on the death of Prince Muazzam Jah Bahadur ; such interest can never be said to be indeterminate because the beneficiary was named. For the above reasons, we are of the view that the Tribunal is right in upholding the order of the Commissioner of Wealth-tax (Appeals) and holding that section 21(1) will apply. We, therefore, find no reason to di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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