- (1.) We shall state the facts in I.T.R.No. 143 of 1985 as it is agreed that our answer to the reference has only to be implemented in the other petitions which are all under sub-s.(3) of S.27 of the Wealth Tax Act, 1957 hereinafter referred to as the Act.
(2.) The Income Tax Appellate Tribunal, Cochin Bench has referred the following questions of law for the determination of this Court under S.27(1) of the Act: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the shares of the beneficiaries of the trust are definite and ascertainable 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the family members who were allowed to reside in the properties free of rent are not beneficiaries of the trust -
(3.) The trust in question is one created by one M. George Joseph by a deed of trust dated May 22, 1972 (a copy of which is Annexure D to the statement of the case) in respect of certain immovable properties owned by him. Therein George Joseph stated that he was getting old and was desirous of imparting education "as high as possible" to his three grandchildren namely, Pradeep George Joseph, Pramod John Joseph & Praveena Elizabeth Joseph, who were aged 7 years, 5 years and 1 year respectively on the date of Annexure D. The object with which the trust was created was to enable these children to receive the education by giving them "all facilities and training". The eldest son of the author of the trust, Dr. David Joseph was appointed as the trustee for the proper and due execution of the trust. He was to keep possession of the properties, manage them, collect the income and apply the net income for the education of the three named grandchildren, till the youngest of them Praveena Elizabeth Joseph attained the age of 21. The deed further stipulated that if there was any surplus, that shall be dealt with in the same manner as the corpus. The trustee was given the discretion to incur the necessary expenditure for purposes of the trust and for the upkeep of the properties and their development for which he was not accountable to any person. Clause.5 of the deed is important. It provided that on the expiration of the period mentioned namely on the youngest child Praveena Elizabeth Joseph attaining ' the age of 21, the trustee shall deliver the properties equally to the beneficiaries with all funds, if any, remaining with him, and the beneficiaries were at liberty to use the properties and funds at their discretion. The trustee was not entitled to alienate the properties but he had the power to terminate the existing tenancies, and to grant fresh leases, ie. he could collect the income in whatsoever way he was pleased. The last clause, namely Clause.8 is one which gave room for much controversy between the parties. It recited that all the properties except items Nos. 2, 3 and 5 have been rented out, that the family members of George Joseph were residing in item Nos. 2 and 3, and that their residence free of rent shall be continued. These are the salient features of the deed of trust with which we are concerned in this case.;