9911796707
TMI Blog1986 (4) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... that the annuity of Rs. 1,500 per mensem received by the assessee in terms of the will of her late husband cannot be assessed in the hands of the assessee for the assessment years in which the trust has been directly assessed ? (ii) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is correct in holding that section 165 of the Income-tax Act, 1961, is to be applied?" In order to appreciate these questions, it is necessary to notice the facts as found by the Tribunal. One Arthur John Davis of Pollibetta, Coorg District, who was the owner of two coffee estates situated in the District of Coorg and other properties, executed a will on November 24, 1950, bequeathing his properties to various persons set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he annuity of Rs. 18,000 per annum to the assessee for the assessment years 1961-62 to 1965-66 and 1967-68 to 1972-73 corresponding to the previous years ending on every 31st March of that year. For the assessment years 1961-62 to 1965-66 and 1967-68 to 1972-73, the assessee filed her returns before the Income-tax Officer, Assessment-7 Circle-II, Bangalore, disclosing the receipts of the aforesaid sums, however, claiming that the same was not chargeable to tax under the Act which was initially accepted by the Income-tax Officer. But in exercise of the powers conferred by section 147 of the Act, the Income-tax Officer re-opened the assessments for the aforesaid years and by his orders made on December 4, 1976, brought the said amounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forth by the power of attorney holder of the assessee are not correct as discussed below : (i) The trust, A. J. Davis Trust, was formed as per the will of late Mr. A. J. Davis. The will among others appointed Mrs. D. C. Davis, as one of the executors and trustees. (ii) The testator directs that the trustees shall pay my wife, Mrs. D. C. Davis, and her issue, if any, as subsistence money monthly of Rs. 1,500 free of all taxes until her death or re-marriage and the Grove Bungalow with garden and godowns and servants' quarters with three servants allowances, also one motor driver and, if necessary, a mechanic shall be supplied from the estate free of charge to her and the upkeep of bungalow, garden, godowns, servants' quarters, garages a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore 1961-62 and the trustees had taken over the same is essentially on a question of fact, which it was entitled to record in exercise of its appellate jurisdiction under the Act. We are also of the view that the finding of fact recorded by the Tribunal, which does not suffer from any legal principle is based on an appreciation of all the facts and circumstances and does not suffer any infirmity. But, this concurrence of ours with the Tribunal does not solve the problem, in particular question No. 1, that is crucial to both sides. We have earlier set out clause 5 of the will in its entirety. Clause 5 directs the trustees first to pay the annuity to the assessee. The annuity must be paid to the assessee whether the trust gets income from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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