SECOND GIFT-TAX OFFICER Vs. NIRMALA RAJASEKHARAN

JUDGEMENT

(1.) The department has preferred this appeal against the order dated 10-12-1982 of Shri T. G. Nair, the AAC, who allowed the appeal against the order dated 31-1-1981 of Shri M. R. Raman, the second GTO, passed for the assessment year 1979-80.

(2.) The only issue in this appeal is that a gift given to the daughter at the time of her betrothal is gift to be exempted under section 5(1) (vii) of the Gift-tax Act, 1958 (the Act). The GTO took the view that gift of jewellery to the unmarried daughter for the purpose of her marriage on her betrothal is not at all gift on marriage. Since the transfer has not been made at the time of marriage, hence, premature. Accordingly, he disallowed the exemption at Rs. 10,000 out of the claim of Rs. 70,000 said to gifted on marriage to the daughter of the assessee.

(3.) In appeal, the AAC took the view that section 5(1) (vii) says that the gift on the occasion of marriage of relative does not mean at the time of marriage and, therefore, it is ridiculous to insist that gift should be given only at the time of marriage. He further viewed that when gift was made in connection with the marriage, it would be made on the occasion of the marriage. Therefore, the AAC took the view that the gift in dispute amounting to Rs. 10,000 at the time of betrothal could not be held to not the subject of section 5(1) (vii). Hence, the assessee is also entitled to exemption qua this amount of gift. Accordingly, he deleted the addition of Rs. 10,000 made by the GTO.