THANKAMMAL G Vs. STATE OF KERALA
HIGH COURT OF KERALA
STATE OF KERALA
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(1.)THIS is a reference by the Kerala Agrl. IT Tribunal, Trivandrum, under S. 60(1) of the Agrl. IT Act, 1950. The assessment year concerned is 1958 -59 and the accounting period the twelve months ended 31st Dec., 1957.
(2.)THE questions referred are :
"1. Whether, on the facts and circumstances of the case, S. 8(2) of the Agrl. IT Act is applicable to the assessment of the agricultural income -tax on the agricultural income derived from the land of each of the minor children? 2. Whether, on the facts and circumstances of the case, the rate applicable to the agricultural income of each of the minors is the rate applicable to the total agricultural income derived from the land of each of the minors plus the total agricultural income of the assessee from her own lands -
(3.)THE assessee executed a gift deed in favour of her minor children. The genuineness and validity of the gift is not in dispute. It is also agreed that under the deed separate items of property were
separately allotted to each of her children. and that each child became the full owner of the items
allotted to that child.
Sec. 8(2) of the Agrl. IT Act, 1950, reads as follows :
"(a) Save as provided in Sub -S. (i), if a person holds land from which agricultural income is derived partly for his own benefit and partly for the benefit of others or wholly for the benefit of others, agricultural income -tax shall be assessed on the total agricultural income derived from such land at the rate which would be applicable if such person had held the land exclusively for his own benefit. (b) Any person holding such land shall be entitled before paying to any beneficiary the amount of agricultural income which such beneficiary is entitled to receive, to deduct the amount of agricultural income -tax at the rate at which such income is or will be assessed under cl. (a). Explanation. -In this section 'beneficiary' means a person entitled to a portion of the income derived from the land."
The contention of the Department is that the mother holds the items of property given to each minor "wholly for the benefit of" that minor and that as a result the sub -section comes into
As stated by the Supreme Court in W. O. Holdsworth vs. State of Uttar Pradesh (1958) 33 ITR 472,
the expressions "for the benefit of" and "on behalf of" are not synonymous with each other. They
convey different meanings. The Tribunal has apparently failed to realise this distinction.
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