COMMISSIONER OF INCOME TAX Vs. ASHOK KUMAR

JUDGEMENT

(1.) THE Income-tax Tribunal, Allahabad, has referred the following question of law under Section 256(1) of the Income-tax Act, 1961, for the opinion of this court :

(2.) IN brief, the facts giving rise to this question are these. The assessee gifted a sum of Rs. 50,000--through bank draft dated March 8, 1975, to Km. Hem Lata. Subsequently, the assessee married Km. Hem Lata on March 13, 1975. The interest accrued on the amount gifted was included in the income of the assessee for the assessment year 1976-77. The assessee objected that since the gift of a sum of Rs. 50,000 was prior to the date of marriage and as such, interest accrued thereon cannot be included in his income. However, the INcome-tax Officer disallowed the objection. On appeal, the Appellate Assistant Commissioner of INcome-tax, Range-II, Agra, deleted the addition of interest made by the INcome-tax Officer. This view of the Appellate Assistant Commissioner was confirmed by the INcome-tax Appellate Tribunal. The only question is as to whether any interest accrued on money gifted by an assessee to his spouse prior to the marriage is covered by Section 64 of the INcome-tax Act.

(3.) IN such circumstances, the income derived from the gifted amount is not covered by Clause (ii) of Sub-section (1) of Section 64 of the Act.