KANTAWALA, J. - (1.) THE two questions referred to us in this reference, one of them being under S. 66(1)/256(1) of the Indian IT Act, 1922, and the other being under S. 27(1) of the WT Act, 1957, are as under: "1. Whether, on the facts and in the circumstances of the case, the dividend income from the 1,500 shares of Changdeo Sugar Mills Ltd. is rightly includible in the applicant's assessments under S. 16 (3)(b) (asst. year 1961 62) and under S. 64 of the 1961 Act (asst. year 1962 63) ? 2. Whether, on the facts and in the circumstances of the case, in the wealth tax assessment for 1960 61, the value of 1,500 shares of Changdeo Sugar Mills Ltd. is rightly includible in the applicant's net wealth under S. 4(1)(a)(iii) of the WT Act ?"
(2.) THE assessee is an individual having substantial income from salary, property and dividends. By a deed of trust dated March 30, 1960, he settled upon trust and transferred to the trustees mentioned in the said deed of trust, inter alia, 1,500 shares of Changdeo Sugar Mills Ltd. The assessee had a son by name Bharat Kanaiyalal Sheth who was aged about 2 years on the date of the deed of trust. The deed of trust provided, inter alia, as under : "The trustees shall : (a) May apply and/or spend and utilise the net income of the trust estate and all accumulations of the income and profits of the trust estate or the corpus of the trust estate for providing food, clothing, residence, education, medical attendance and treatment and marriage expenses and benefit of the said Bharat Kanaiyalal Sheth till he attains the age of 21 years. (b) On the said Bharat Kanaiyalal Sheth attaining the age of 21 years, hereinafter referred to as 'the date of distribution of the trust estate', the trustees shall hand over the entire trust estate along with all the accumulations and accretions thereto to the said Bharath Kanaiyalal Sheth and he shall be the sole and absolute owner thereof provided however that if the said Bharat Kanaiyalal Sheth shall have died before the date of distribution of the trust estate the trustees shall distribute the trust estate in equal shares amongst the heirs of the deceased other than Kanaiyalal Maneklal Sheth (since deceased) who may be alive at the time of distribution according to the law by which the said deceased may be governed at the time of his death." Clause 4 of the deed of trust is as under : "4. Nothing contained in cl. 2 hereof shall confer or be deemed to confer upon any of the beneficiaries mentioned in cl. 2 hereof any vested interest in the trust estate till the date of distribution hereinbefore mentioned."
(3.) SO far as question No. 1 is concerned Mr. Mehta appearing on behalf of the assessee has for the purposes of this Court conceded that in view of the judgment of Vimadalal and S. K. Desai, JJ. in WT Ref. No. 21 of 1966 [Shardaben Jayantilal Mulji vs. CWT 1976 CTR (Bom) 88 : (1977) 106 ITR 667 (Bom)) question No. 1 should be answered in the affirmative and in favour of the Revenue.;