COMMISSIONER OF INCOME TAX Vs. BALAKRISHNA RAO K

JUDGEMENT

(1.) THE Revenue having lost before the Income-tax Appellate Tribunal, Madras Bench, the following questions were referred to this court at its instance :

(2.) THE two appeals, I.T.A. Nos. 784 and 1953/73-74, relate to the assessment years 1969-70 and 1970-71, respectively, but concern the same assessee. At the outset, it is relevant to point out that the questions of law referred to this court are confined to the immovable assets, viz., Hotel Dasaprakash at Nos. 49, 50 and 51, Poonamallee High Road, Madras, and Modern Cafe, Esplanade, Madras, and all other movable assets, furnitures fitting and fixtures and all the rights, goodwill, etc., attached to and belonging to the said hotels. It is common ground that the appreciation of these questions depends solely on the construction of the will dated January 7, 1968, executed by the deceased, K. Seetharama Rao, particularly bearing in mind the intention of the testator. According to the Revenue, the income has to be assessed in the hands of the executors as named in the will as a body of persons as provided under s. 168 of the I.T. Act (for brevity hereinafter referred to as "the Act"). Alternatively, it is contended by the Revenue assuming that the said movable assets are being managed by the trustees, yet, in the circumstances of the case, the income from the hotel business and the income from the property at Sunkurama Chetty Street should be taxed in the hands of the assessee as income received by the trustees in accordance with s. 164 of the Act.

(3.) ACCORDING to us, such a finding cannot be sustained on the plain language employed in the will and on the construction we have made, as above. Indeed, we find no reasoning in the order passed by the Tribunal to justify such a finding; apparently, the Tribunal concentrated its attention more on the alternative contention than this particular question revolving on s. 168 of the Act.