9911796707
TMI Blog1981 (10) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... d their respective HUFs. For the asst. yr. 1976-77, there was a change in the constitution as evidenced by deed dt. 5th December, 1975 on the demise of Hardwari Mal. The Constitution of the firm for the asst. yr. 1976-77 was, therefore, as under after the demise of Shri Hardwari Mal: (1) Tuhi Ram 25% (2) Ganga Ram 25% (3) Roshan Lal 25% (4) Smt. Chander Pati Devi 25% 3. Shri Hardwari Mal was the patriarch of the family. His wife Smt. Chander Pati Devi has been admitted as a partner in the asst. yr. 1976-77 after his demise. They had five sons, namely, Tuhi Ram, Ganga Ram, Ram Niwas, Roshan Lal and Suresh Kumar, Smt. Pisto Devi. Smt. Chameli Devi, Smt. Gayatr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sons out of the gifts made to them: . Rs. Roshan Lal 190 Suresh Kumar 308 Naresh Kumar 450 Parwati Devi 850 Laxmi Narain 400 . 2,918 The AAC for the asst. yr. 1976-77 went in detail into the question of the gifts made and the reasonableness and held that the gifts were invalid because they were not of reasonable amounts. He confirmed the disallowance. Hence the first issue that we have to decide in these appeals is whether disallowance of interest in both the years under appeal is justified or not. 7. We have very carefully considered the rival submissions and we find that the gifts firstly cannot be called cross gifts. The gifts are as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we have gathered from the orders of the authorities below and from the information, at out directions, filed by the ld. counsel for the assessee. In our opinion, considering the status of the donors, the donees and their inter-relationship, and the time of the gifts, these are and cannot be cross gifts. Therefore, the first reason given by the ITO to set the appeal processing to motion, does not exist. Before us the ld. Counsel for the assessee pointed out that in so far as Smt. Gayatri Devi is concerned, she has also received the gifts and deposited the said amount with the firm yet the interest paid to her was not disallowed either by the ITO or by the AAC. He also contended that the ITO worked under misunderstanding that Roshan Lal was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gifts has to be considered in its own perspective considering the donor and the donee and his capacity. Taking this view of the matter, we do not find that the gifts are excessive. To our mind the judgment of the Hon'ble High Court in the case of Daljit Singh applies to the facts of the case before us and covers the case. We held that the disallowance of interest for the asst. yrs. 1975-76 and 1976-77 was clearly uncalled for. We, therefore, reverse the orders of the authorities below on this ground and direct the interest payment to be allowed as claimed. 8. The only other issue that requires our consideration for the asst. yr. 1975-76 is the question of exigibility of the amount of Rs. 1,392 representing dharmada collections by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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