COMMISSIONER OF GIFT TAX Vs. B S APPARAO

JUDGEMENT

(1.) The Revenue questions the correctness of the decision of a division Bench of the High Court at Hyderabad to answer in the negative and in favour of the assessee the following question :

(2.) The assessment year with which we are concerned is 1970-71. During the course of the year, that is, on 26/03/1970, the assessee gifted in favour of his three minor daughters, aged five, three and one respectively, land worth Rupees one lakh each. The gift deeds, one of which is produced before us and which, it would appear, was before the authorities and the tribunal, states that the gifts were made because it was the assessee's bounden duty according to the law to look after the daughters' education, livelihood, marriage and other expenses. Before the Gift-tax Officer the assessee's plea that this was not a gift but a transfer of property to meet his obligation under law met with no success. However, the Appellate Assistant commissioner, the Tribunal and the High Court accepted the assessee's contention.

(3.) Learned counsel for the Revenue drew our attention to the provisions of section 5 (l) (vii) of the Gift-tax Act. By reason thereof, gift-tax is not chargeable in respect of gifts made by any person "to any relative dependent upon him for support and maintenance, on the occasion of the marriage of the relative, subject to a maximum of Rupees ten thousand in value in respect of the marriage of each such relative". [that is how the provision read at that time; the limit is now Rupees one hundred thousand. ] It was submitted by learned counsel that, therefore, the gift was exempt only in respect of the sum of rupees ten thousand for each daughter and that the balance was exigible to gift-tax.