DALOORAM JAYANARAIN Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee, an HUF of which Dalooram Jayanarain was the Karta, carried on extensive business in Madras. The business books of the assessee carried a credit of Rs. 75,000 in the name of Manbari, the wife of Dalooram Jayanarain. The assessee treated that as her money which the assessee had borrowed and invested in his business. Manbari was credited every year with interest on the loan. She died on 19th May, 1945. On 2nd Nov., 1948, a sum of Rs. 31,000 out of what stood to her credit was transferred by Dalooram Jayanarain to the credit of the Dalooram Jayanarain Trust Account, the balance, with which we are not concerned was left in the account of Manbari. The Dalooram Jayanarain Trust account was credited with interest year after year, calculated on the amount to the credit of the account. On 5th April, 1951, Dalooram Jayanarain executed a registered deed of trust, annexure "A". The preamble in that document ran :