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TMI Blog1983 (9) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... B. G. Amin, Solicitor, now dead, as executors and trustees thereof. She directed the executors and trustees by the will to pay her debts, funeral expenses and estate duty. She directed them to wind up a business that she was then conducting or to sell it as a going concern. She directed them to convert all the movable and immovable properties in her estate, other than those bequeathed specifically, into cash. She listed the specific bequests. Clauses 15, 16 and 20 of the will are most relevant to this proceeding and read thus: " 15. I direct that my executors and trustees of this my will shall convey to the respective legatees of my aforesaid immovable properties after obtaining probate of this my will and until such properties are trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the benefit of and for providing aid to such religious institution or institutions as they may in their absolute discretion think fit. " The executors and trustees obtained probate of the will on April 5, 1963. They carried out the directions in the will pertaining to specific bequests between August, 1963, and March, 1964. On June 19, 1963, the executors and trustees made an application to the Deputy/Assistant Charity Commissioner, Greater Bombay Region, for registration of the trust under the will, to be known as the " Bhikhubai Chandulal Jalundhwala Trust ". A copy of that application has been handed over to us. It lists the movable and immovable properties left behind by the deceased, other than those specifically bequeathed, as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he condition of payment of the legacies mentioned therein, that the trust resulted on her death, that the assessee and the late Amin straightaway acquired the role of trustees, and that the income ought to have been assessed as such. In any event, they had shed their character as executors and had acquired the character of trustees on April 5, 1963, when the probate was granted. Even if it were assumed that these conclusions were not correct, the position was that the whole estate, including the immovable properties and the amounts directed to be distributed by way of legacies, had vested in the assessee and the late Amin as trustees. Hence, the income of the immovable properties specifically bequeathed and of assets sufficient to pay off t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether, it is clear that the executors and trustees were directed, first, to convert the immovable and movable properties comprising the estate into cash and, then, to use the entire residue of the estate, comprised now of that cash for the charitable objects mentioned in clause 20. The trust for the charitable objects was, therefore, under the provisions of the will, to come into existence after the executors and trustees had administered the estate and converted it, or at least a substantial portion of it, into cash. A glance at the statement regarding the progress of the administration of the estate reveals that a very substantial portion of the estate had remained unadministered at the conclusion of the assessment year with which we ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ards that he should be assessed as a trustee. His claim was negatived by the ITO and by the AAC, but the Tribunal upheld it. The Madras High Court on reference considered ss. 7(6) and 9 of the Official Trustees Act, and concluded that as the official trustee had been appointed both as sole executor and sole trustee, the properties initially vested in him as executor and, as soon as he obtained probate of the will, they vested in him as trustee. The assessee and the facts in the Madras case are dissimilar to the assessee and the facts before us. The Madras judgment mentions an earlier decision of the Madras High Court in Raghavalu Naidu Sons v. CIT [1950] 18 ITR 787, where it was held that in the case of the residuary bequest, until the re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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