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TMI Blog1981 (7) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... , each being the subject-matter of the trusts dated 31-8-1953 and 17-8-1957 created by the deceased ?" The above question had arisen in the estate duty assessment proceedings of one Tricumdas Mulji Shah who died on September 25, 1964. His widow, Bai Jadhavbai, who was the original accountable person died during the pendency of this reference and her six daughters who were the only children of the marriage of Bai Jadhavbai with the deceased have been brought on the record as the heirs and legal representatives of Bai Jadhavbai. The deceased had-executed two deeds of trust, the first dated August 31, 1954, and the second dated September 17, 1957. Under both these deeds of trust the said Bai Jadhavbai and one Mansukhlal Popatlal Shah were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... among the said six daughters on December 31, 1967. Both these deeds of trust conferred a power upon the trustees to invest the trust property in immovable properties or in shares in limited companies or in fixed deposits with any one or more banks as also with any firms or companies including any firm in which any of the trustees or the settlor might be interested. The relevant clause conferring this power upon the trustees is cl. 4 of the first deed of trust and cl. 3 of the second deed of trust. In pursuance of the power conferred upon them by the said clauses referred to above, the trustees kept the said two sums of Rs. 60,000 each in deposit with M/s. Tricumdas Mulji Shah and Company of which concern the deceased was then the sole pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty taken under any gift, whenever made, shall be deemed to pass on the donor's death to the extent that bona fide possession and enjoyment of it was not immediately assumed by the donee and thenceforward retained to the entire exclusion of the donor or of any benefit to him by contract or otherwise : Provided that the property shall not be deemed to pass by reason only that it was not, as from the date of the gift, exclusively retained as aforesaid, if, by means of the surrender of the reserved benefit or otherwise, it is subsequently enjoyed to the entire exclusion of the donor or of any benefit to him for at least two years before the death: ... . ........... " This section came to be analysed by the Supreme Court in George Da Cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at by the medium of the machinery of the said deeds of trust, gifts were made by the donor to the beneficiaries under the said deeds of trust. It is also not disputed that the said deposits by the trustees were in substance deposits made by the donees of the said deeds of trust. Though there is some confusion as to whether the said two sums of Rs. 60,000 each were, in fact, handed over by the deceased to the trustees, the matter before all the authorities has proceeded upon the basis that the donees assumed possession and enjoyment of the property, which was the subject-matter of the gift, to the exclusion of the donor immediately upon the gift being made. Thus, the first part of s. 10 would, therefore, be satisfied. What is, however, conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sense of his being co-owner, for, even though the partnership firm is not a legal entity in the sense of having a legal personality of its own, different from that of the partners, no partner can claim a share in the partnership property according to his share in the partnership, the reason for this being that the creditor of the partnership was entitled to get back the whole of his property on dissolution of the firm or otherwise while a Partner was entitled to get his share only in the net assets of the property realised on the winding-up of the partnership. The position which applies to a partnership cannot, however, apply to the case of an individual. While in a partnership, no partner can point to a particular asset of the partner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kamlavati's case [1979] 120 ITR 456 at page 464. That passage is as follows : "If a firm borrows money so as to be itself liable for it to the lender, the capital of the firm is no more increased than is the capital of an ordinary individual increased by his getting into debt." The above passage in Lindley is from the section of the book which deals with a partner's power to borrow money in order to increase the capital of the firm and the sentence quoted by the Supreme Court is from that part of the discussion where Lindley discusses the power and the obligation of a partner who borrows money on his personal credit in order to put it in the capital of the firm. To our mind it is irrelevant whether the capital of the deceased was increa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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