COMMISSIONER OF INCOME TAX Vs. PUSHPAWATI GOEL SMT

JUDGEMENT

(1.) In this petition under Sec. 256(2) of the Income -tax Act, 1961 (' the Act') the Commissioner is seeking a direction that the Tribunal should refer the following two questions of law arising from its order:

(2.) Being aggrieved, the respondent filed an appeal to the AAC who allowed the said appeal and directed the ITO to exclude the income which had been included in the hands of the respondent. The department filed an appeal before the Tribunal in respect of the assessment year 1979 -80. It may be stated here that in respect of the assessment years 1982 -83 and 1983 -84, the assessment was completed on the basis of the return filed by the assessee wherein she had not included any part of the income from the trust. This order of the ITO was received by the Commissioner under Sec. 263 of the Act. An appeal was filed against this order before the Tribunal.

(3.) The Tribunal interpreted Sec. 64(1)(vi) and came to the conclusion that the transfer of property to a trust for the benefit of the daughter -in -law and the grand -children of the assessee did not attract the said provisions. In coming to this conclusion, the Tribunal took note of the fact that with effect from 1 -4 -1985, clause (viii) was inserted which made it clear that any such* transfer to an AOP or any person for the benefit of daughter -in -law and grand -children would attract the provisions of Sec. 64. The Tribunal came to the conclusion that the insertion of this clause in 1985 showed that such a contingency was not contemplated by Sec. 64(1)(vi) .