COMMISSIONER OF INCOME TAX Vs. SAURIN S ZAVERI

JUDGEMENT

(1.) THE question that is referred to us in respect of the assessment years 1987-88 and 1988-89 is,

(2.) THE managing trustee of the trust, by name, Manilal Bapalal Family Benefit Trust, filed returns on behalf of the minor, Master Saurin Zaveri, as one of the beneficiaries for the assessment years 1987-88 and 1988-89 disclosing the beneficiary's share from the trust. THE managing trustee claimed deduction under Section 80C of the Act. This claim was allowed by the Assessing Officer. Subsequently, finding that the trust was carrying on business, the Assessing Officer concluded that the whole of the income must be assessed to tax at the maximum marginal rate and the application of Section 80C did not arise and negatived the assessee's claim for deduction under Section 80C does not arise. On appeal, the Commissioner of Income-tax (Appeals) allowed the appeal. THEreupon, the Department filed the appeal before the Income-tax Appellate Tribunal; the Income-tax Appellate Tribunal also decided based upon its own decision regarding another beneficiary from the same trust. In the circumstances, the above question has been referred.