MAMMON K CHERIAN Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE Income-tax Appellate Tribunal, Cochin Bench, has referred the following question to this court for its opinion :

(2.) THE year of assessment was 1962-63. THE short question with which we are concerned relates to the income of Rs. 4,457, derived by renting out the building which was constructed on a plot of land which belonged to the assessee's wife with funds furnished, according to the findings entered by the Tribunal, in its entirety, by the assessee, is liable to be taxed in the hands of the assessee as income derived from an asset directly or indirectly transferred by the assessee to his spouse falling within Section 64(1)(iii) of the Income-tax Act, 1961. That section is in these terms:--

(3.) THE plot of 20 cents on which the building was constructed belonged exclusively to the assessee's wife. THE entire cost of construction was with funds furnished by the assessee. THE claim of the department is that the rent derived from the building by renting it out is income arising from assets transferred by the assessee directly or indirectly to his spouse without adequate consideration.