- (1.) THESE appeals by the assessee arise out of two common orders dated 4-9-1991 and 6-11-1991 of the CWT (Appeals), I, Indore, pertaining to the assessment years 1984-85 to 1989-90. Since common issue is involved in all these appeals, these were heard together and are being disposed of by this common order for the sake of convenience.
(2.) The common issue relates to the inclusion of the value of 1/6th share in Lady Kanchanbai Trust and Sir Hukumchand Trust in the net wealth of the assessee. Briefly stated, the assessee is an individual. He filed his returns of net wealth as under : Assessment year Date of filing New wealth declared the return 1984-85 30-9-1985 6,11,298 1985-86 31-12-1985 4,32,180 1986-87 31-3-1987 7,76,382 1987-88 30-7-1987 10,49,948 1988-89 29-7-1988 96,965 1989-90 4-10-1989 (-) 17,488 During the course of assessment proceedings of the aforesaid assessment years, the assessee vide his letter dated 5-1-1989 stated that he has made unequivocal declaration on 19-10-1964 by which he has thrown 1/6th interest in the trusts, namely, M/s. Shreemant Danvir Sir Hukumchand Trust (hereinafter referred to as 'Sir Hukumchand Trust') and Smt. Shoubhagya Danshila Lady Kanchanbai Trust (hereinafter referred to as 'Lady Kanchanbai Trust') in the common hotch-potch of his HUF w.e.f. 31-10-1959. In support thereof, copies of documents executed on 19-10-1964 were filed. It was contended before the Assessing Officer that the effect of the said declaration has never been considered from the angle of disposition of beneficiary interest in favour of HUF. The tax authorities and Court have interpreted the declaration in the context of intention of the Settler of the trust and have considered that the declaration did not change the intention of the Settler. It was contended that the declaration has not been considered with a view whether the beneficiary could dispose of his share in the manner he liked. It was further stated therein that as per section 58 of the Indian Trust Act, the beneficiary is competent to transfer or dispose of his interest subject to law for the time being in force as to the circumstances and extent in and to which he may dispose of such interest. In view of the above and on the strength and effect of the declaration made by the assessee, it was submitted that the decision of the Supreme Court in CIT v. Maharaja Bahadur Singh [1986] 162 ITR 343/28 Taxman 560A rendered on 13-10-1986 is inapplicable to the assessee's case as the Hon'ble Supreme Court has also not considered this another effect of declaration. It was also stated therein that the decision (supra) of the Hon'ble Supreme Court pertained to assessment years 1962-63 and 1963-64. It was, thus, claimed that 1/6th interest in the corpus of the above two trusts belongs to his HUF and, therefore, be not included in his individual assessments for the assessment years in question. The submissions of the assessee did not find favour with the Assessing Officer. Relying on the decision in Maharaja Bahadur Singh (supra) and the decision of the Tribunal rendered on 10-2-1989 in ITO v. Jambukumar Singh Kasliwal, Indore [IT Appeal Nos. 106 to 108 (Indore) of 1985] in the case of the assessment years 1981-82 to 1983-84, he rejected the assessee's contention and included 1/6th share in the two trusts to the wealth of the assessee individual in all the assessment years as under : Asstt. 1/6th share from 1/6th share in Date of Asstt. year. Lady Kanchanbai Sir Hukumchand order u/s Trust Trust 16(3) --------- ---------------- ------------- ------------- 1984-85 4,96,628 2,56,278 20-3-1989 1985-86 5,11,217 2,35,209 -do- 1986-87 4,91,307 1,93,373 4-1-1990 1987-89 6,09,874 2,90,062 15-3-1991 1988-89 6,28,810 1,12,314 -do- 1989-90 6,28,810 1,12,314 -do- Dissatisfied, the assessee appealed. Before the CIT (A), the assessee reiterated the same contentions. The assessee did not succeed for the following reasons recorded by the CWT (Appeals) : (i) The declaration dated 19-10-1964 was with retrospective effect from 31-10-1959. Hence the same was applicable to the assessments for the assessment years 1962-63 and 1963-64 as decided by the Hon'ble Supreme Court against the assessee. (ii) The effect of the Tribunal's decision dated 21-4-1987 in the assessee's case for the assessment years 1980-81 and 1981-82 in WTA Nos. 210 and 211/Ind/1986 is that the inclusion of 1/6th share in the above two trusts in the hands of the assessee in his individual capacity stands upheld. (iii) Shri Jambukumar Singh Kasliwal is one of the beneficiaries of the two trusts along with the assessee and the decision of the Tribunal in the case of Jambukumar Singh Kasliwal for the assessment years 1981-82 to 1983-84 is also applicable, the facts being identical.
(3.) INTERPRETING clause (4) of the trust deed, the CWT (Appeals) further held that the assessee did not have absolute right in the beneficial interest and was, therefore, not competent to dispose of the same in the manner he liked at least till the due date of distribution of corpus. Feeling aggrieved, the assessee is before us.;