COMMISSIONER OF INCOME TAX Vs. TRUSTEES OF SREERAM SURAJMULL CHARITY TRUST
HIGH COURT OF CALCUTTA
COMMISSIONER OF INCOME-TAX
TRUSTEES OF SREERAM-SURAJMULL CHARITY TRUST
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P.B.Mukharji, CJ. -
(1.) In this income-tax reference under Section 66(1) of the Indian Income-tax Act, 1922, the main controversy is about the validity of a certain trust and its claim to exemption from tax. Two questions raised are as follows :
" 1, Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that a valid trust came into existence under the deed of trust dated October 11, 1939 ? 2, If the answer to the first question is in the affirmative, whether the Tribunal was right in holding that the said trust was not a revocable trust within the meaning of Section 16(1)(c) of the Income-tax Act, 1922, and, as such, its income was exempt from tax under Section 4(3)(i) of the said Act ?"
(2.) The following facts give rise to the above questions. The assessee is a charitable and religious trust represented by the trustees of Sreeram Surajmull Charity Trust. This charitable and religious trust is proved by a deed dated October 11, 1939. It is a duly attested and registered deed on the records of this case. According to the assessee, certain steps had already been taken from a period prior to June 24, 1928. The Income-tax Officer came to the conclusion that the trust came into existence only on October 11, 1939, on the execution of the trust deed. This finding was upheld by the Appellate Assistant Commissioner. The Tribunal expressed the view that it was not necessary to discuss whether there was a valid trust prior to October 11, 1939.
(3.) The trust deed sets out that on March 29, 1939, the corpus of the trust would consist of: (1) the house at Benares, (2) twenty preference shares in the Chitavalsah Jute Mills Co. Ltd. bearing Nos. 4400/4420 of the aggregate face value of Rs. 2,000, and (3) Rs. 47,336-1-0 deposited with the settlor's firm of Surajmull Chhotaylal of Calcutta, carrying interest at the rate of nine annas per centum per mensem compoundable once a year.;
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