LAXMIBAI NARAYANA RAO NERLEKAR Vs. COMMISSIONER OF GIFT TAX

JUDGEMENT

(1.) THIS is a reference under section 26(1) of the Gift-tax Act, 1958, made by the Bombay Bench "B" of the Income-tax Appellate Tribunal, at the instance of the assessee. The assessee, since deceased, one N. B. Nerlekar, had owned several properties which were his self-acquired property. On 30th August, 1961, he executed a registered instrument of partition to which himself, his wife and five children were parties; N. B. Nerlekar himself was party No. 1. The properties were set out in two schedules "A" and "B". The "A" schedule properties he retained for himself and partitioned only "B" schedule properties among himself, his wife and children under the instrument. The opening paragraphs (II) and (III) of the deed contain the following recitals :

(2.) FOR the assessment year 1962-63, the Gift-tax Officer considered that the process evidenced by the above document amounted to a gift by the assessee, N. B. Nerlekar, to the family and imposed gift-tax to the entire extent of the value of the properties in "B" schedule of the deed of partition.

(3.) THE above opinion is that of the Judicial Member of the Tribunal. THE Accountant Member agreed with the proposition that the process was a transfer within the meaning of section 2(xxiv)(d) of the department that the situation would attract the provisions of section 4(d) also.