9911796707
TMI Blog1982 (4) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... ust is the bone of contention between the revenue and the assessee and, hence this appeal. 2. The contention urged on behalf of the assessee is that the WTO erred in bringing to tax under section 21(4), the value of whole of the corpus of the trust instead of aggregate value of life interest and remainderman's interest arrived at by actuary. In support of this proposition reliance was placed on the ratio of the Supreme Court decision in the case of CWT v. Trustees of H. E. H. Nizam's Family (Remainder Wealth) Trust [1977] 108 ITR 555. The argument of the assessee's counsel Shri J.P. Shah was the same which was urged before the WTO on behalf of the assessee, namely, new sub-section (1A) provided for bringing to tax the difference between t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions are different. He also submitted that the intention to make the amendment was quite relevant and he cited the Supreme Court authority in the case of Sole Trustee, Lokashikshana Trust v. CIT [1975] 101 ITR 234. 4. Prima facie, the contention of Shri J.P. Shah which was based on the logic of analogy was quite attractive but on a closer examination of the provisions considered by the Supreme Court in Nizam's Family Trusts case and the amendments made, it became apparent that the view taken by the WTO and sustained by the AAC is quite correct. The provisions of section 21, which were considered by the Supreme Court, are extracted at pages 591-92. In that, section 21(4) reads as under: "(4) Notwithstanding anything contained in this sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... citizen of India and resident in India for the purposes of this Act, and--- (a) at the rates specified in Part I of Schedule I ; or (b) at the rate of one and one-half per cent, whichever course would be more beneficial to the revenue. The sub-section after amendment by the Finance (No. 2) Act, 1980, applicable in this assessment year reads as under: AFTER AMENDMENT "(4) Notwithstanding anything contained in this section, where the shares of the persons on whose behalf or for whose benefit any such assets are held are indeterminate or unknown, the wealth-tax shall be levied upon and recovered from the court of wards, administrator-general, official trustee, receiver, manager, or other person aforesaid, as the case may be, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment would be that of an individual. The word "individual" here signifies the taxable status for the trustees and it is no longer being used in the context of beneficiaries being treated as an individual as was the case in the unamended provision and the provision considered by the Supreme Court. We also notice that the technique of amendment applied for section 21(4) is different from that used for amending section 21(1) by introducing section 21(1A) which was to override that sub-section. In the case of section 21(4) what was considered appropriate was to do away with the fiction in relation to the status of indeterminate or unknown beneficiaries and instead make the trustees liable to wealth-tax in the like manner and to the same ext ..... X X X X Extracts X X X X X X X X Extracts X X X X
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