9911796707
TMI Blog1983 (10) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... at the time of death and why no additions should be made within two years of death. The accountable person's ld. counsel objected to make such addition on several grounds: 1. It was pleaded before the Asstt. Controller that Shri K.R.Shah is the creditor and the son of the deceased made a gift in 1963 by way of Trust in which his son Shri K.R. Shah was the sole beneficiary. An amount of Rs. 5000 was borrowed from him, as a temporary loan after considerable gap of many years. He submitted that the provisions of s. 16 are applicable to the point involved in the case. He pleaded that no abatement u/s 46(1) or u/s 46(2)(b) be made in respect of this loan. The Asstt. Controller held that there was a disposition and the property which it repres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... existence and the deceased's death, viz: on 30th July, 1973 the gap is almost 10 years. The genuineness of the trust is not in question. The deceased did not derive any benefit either directly or indirectly from the said trust in any of these years. On account of a dispute the rental income which was due exclusively to the beneficiary got accumulated, and it is out loan was taken by the deceased. The estate is bound to repay the loan since the trust is not the asset transferred by the deceased himself. The loan is actually of the income which the said asset produced. This income is not transferred by the deceased as such. Therefore, s.46 is not applicable in the circumstances of the case. 3. There is little difference between the submiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a loan. 6. The ld. departmental representative has relied upon the judgment of the Andhra Pradesh High Court in the case of Smt. Pan kumari Kochar vs. CED, A.P.(1969) 73 ITR 373 (AP). In that case, there was no valid trust at all and, therefore, it was held that the properties purported to have been settled by way of trust were rightly included in the estate of the deceased. There is no dispute in this case that a valid trust is in existence. Therefore, this authority does not apply. He has further relied upon the judgment of the Madras High Court in the case of Mrs. Constance Lubeck, in re (1970) 78 ITR 199 (Mad). That case is in respect of paying estate duty out of the estate of the deceased. It is held therein that, "though estate dut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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