SULEKHA BAI Vs. COMMISSIONER OF GIFT TAX

JUDGEMENT

(1.) The question referred to us by the Income Tax Appellate Tribunal, Cochin Bench under S.26(1) of the Gift Tax Act, 1958 (hereinafter called the Act), is in these terms:

(2.) The gift in question was by a deed dated 7-4-1964 executed by the wife in favour of the husband. Earlier she had obtained this property from her husband by a deed of gift dated 26-4-1957. This gift dated 26-4-57 was exempted from tax under S.5(1)(viii) of the Act. S.5(1)(viii) at the time of the later gift ran thus:

(3.) Counsel on behalf of the assessee has contended before us that the scheme of the Act postulates a year as the unit of assessment. This being so, it is further urged that the expression "gifts received by that spouse as fall within Clause (viii) of sub-s.(1)" must be related to gifts received during the relevant previous year with reference to which tax is sought to be imposed under the Act. In effect what is contended for is the words "in the previous year" must be added to the expression that we have quoted above. This we consider, would not be justified for if we do so, in the guise of interpreting the section, we will be amending it. Counsel also emphasised the expression "as fall within Clause (viii)" ,and it was contended that "as fall within Clause (viii)" indicates something that had occurred in praesenti and not in the past as in that case the expression would have been "as fell within Clause (viii)". We do not see much force in this contention because even if the original gift by the husband to the wife was in the previous year, the word could be 'fell' because with reference to the time of the latter gift the earlier one is anterior. "As fall within Clause (viii)" therefore only means the gift to which Clause (viii) was applicable.