COMMISSIONER OF GIFT TAX Vs. SARMA R R

JUDGEMENT

(1.) THE question referred by the Tribunal to this Court for our opinion in relation to the asst. yrs. 1967 - 68, 1968 -69 and 1969 - 70 reads as follows:

(2.) THE assessee had taken two policies of insurance on his life, one for a lakh of rupees and the other for Rs. 25,000. The amounts paid by way of insurance premia during the asst. yrs. 1967 -68, 1968 -69 and 1969 -70, respectively, were Rs. 12,102, Rs, 7,287 and Rs. 7,287. In deciding the amount on which gift -tax should be imposed for the three years, the assessing authority reached the figures of Rs. 20,246, Rs. 15,431 and Rs. 10,431 for the three years by including in each of those years the insurance premia paid by the assessee which we mentioned earlier. Though the assessee contested this inclusion before the AAC, he did not succeed before him. But, on appeal, the Tribunal accepted the assessee's contention that the insurance premia on his own policies would not amount to a gift to the wife and the question that has been referred for our opinion turns on the question whether the view taken by the Tribunal that the assessee's contention is well - founded is correct or not.