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TMI Blog1985 (10) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... s agreed to be paid by the donee, has to be deducted, as a consideration within the meaning of section 4(1)(a) of the Gift-tax Act, 1958 ? " In order to appreciate the question referred to us, it is necessary to notice the facts that are not in dispute. Under a deed of settlement dated March 31, 1973 (annexure-A), the assessee settled her half share in a valuable immovable property, a hotel complex known as " Tourist Hotel " bearing Door Nos. 21, 21/1, 21/2 and 21/3, situated on Race Course Road, Bangalore-9, in favour of one Venkatesha Madi of Bangalore, her foster son, with a condition that he shall pay a sum of Rs. 25,000 to one Smt. R. Ahalya and the gift-tax payable by her under the Act and the same was accepted by him with those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeared for the assessee. Sri Srinivasan has urged for answering the question in favour of the Revenue on the ground that gift-tax payable by the donee on the plain language of section 4(1)(a) of the Act was neither consideration nor a permissible deduction at all. Sri Bhat, in supporting the view propounded by the Tribunal as sound and correct, has urged for answering the question in favour of the assessee. Earlier, we have noticed that while the assessee valued the property gifted by her at Rs. 2,00,000, the Gift-tax Officer valued the same at Rs. 2,75,000 with which the Appellate Assistant Commissioner concurred. As we apprehend, the Tribunal does not appear to disturb the same. We, however, do no not consider it necessary to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that section. In other words, the gift-tax payable on the gift made to Venkatesha Madi (but not the gift-tax payable on the gift to Smt. Ahalya) has to be deducted in making the assessment of the gift under section 4(1)(a). The assessee's claim, therefore, has to be allowed to the extent we have indicated. The learned departmental representative has urged that there is no provision for deduction of gift-tax liability under the Gift-tax Act. In this regard, he pointed out that income-tax cannot be deducted for the purpose of income-tax assessment and deduction of gift-tax liability in this case would be contrary to the statute. He was, however, unable to show to us any specific provision in the Gift-tax Act which would go against our interp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used. " Bearing these principles and other well settled principles of construction of statutes, it is necessary to ascertain the scope and ambit of section 4(1)(a) of the Act. The Act has been enacted to provide for levy of gift-tax. Section 2 defines certain terms. Section 2(xii) of the Act defines the term " gift " as a transfer by one person to another of any existing movable or immovable property made voluntarily and without consideration in money or money's worth, and includes the transfer or conversion of any property referred to in section 4 which is deemed to be a gift under that section. Section 3 of the Act is the charging section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansferred otherwise than for adequate consideration, the amount by which the market value of the property on the date of the transfer exceeds the value of the consideration shall be deemed to be a gift made by the transferor. Every transfer other than by way of a gift, notwithstanding the nature of transfer, is deemed to be a gift, if the circumstances mentioned in the section exist. This provision provides for ignoring the stated money consideration in the deed of transfer and then ascertain the market value of property transferred as on the date of transfer and treat the difference between the real market value of the property and the stated consideration as a gift for the purpose of the Act and subject that difference to gift-tax under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be in the negative, in favour of the Revenue and against the assessee. Before parting with this case, it is necessary to notice that relying on the observation made by a Division Bench of this court in CIT v. M. Ramaiah Reddy (I.T.R. No. 119 of 1980-[1986] 158 ITR 611), Sri Bhat has urged that the Tribunal had failed to consider the contention urged by the assessee touching on the valuation of the property made by the Gift-tax Officer and affirmed by the Appellate Assistant Commissioner and the Tribunal should be directed to deal with the same. On the finding recorded by the Tribunal and on the question referred to us, this contention cannot be examined by us. Whether any contention urged by the assessee had not been examined and decide ..... X X X X Extracts X X X X X X X X Extracts X X X X
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