T M A PAI Vs. IN RE

JUDGEMENT

(1.) WE are asked to give opinion under S. 66 of the Act on the following question of law, viz., whether the income arising from the properties held on trust under the trust deed dated 21-11-1944 is liable to be included in computing the total income of the assessee.

(2.) ON the 21st November 1944, the assessee and his wife executed a document styled a deed of trust, whereunder they constituted the Canara Industrial and Banking Syndicate Ltd., as trustees, and the property described in the schedule attached to the deed was vested in them subject to certain trusts which are specified in the deed. The substantial benefit under this document is for the benefit of their minor children. The settlors divested themselves of all the right and interest in the properties, and the trust was made absolute and irrevocable. In computing the total income of the assessee for the purpose of income-tax assessment, the income of the properties covered by the trust deed was included by the Department under Section 16(3) (b) and Section 16(3) (c)(iv) of the Act.