KESHAVJI MORARJI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference has a chequered history and it has come before us for decision in view of an order passed by the Supreme Court (CIT vs. Keshavji Morarji (1967) 66 ITR 142 (SC) allowing an appeal from a decision of a Division Bench of this Court in this reference at an earlier stage and remanding the matter with a direction to the High Court to call upon the Tribunal to submit a statement of the case under S. 66(4) of the Indian IT Act, 1922 (hereinafter referred to as "the Act"). In accordance with the said direction a supplemental statement of the case has been submitted by the Tribunal.

(2.) THE assessee is a resident of Bombay. He has a son by name Jaysinh and three daughters Indumati, Kusum and Dipika. In the relevant years of assessment Dipika was a minor Jaysinh has two infant children, Bipin and Kamla. On June 14, 1952, Keshavji, the assessee, transferred a sum of Rs. 5 lakhs to his Son, Jaysinh. By an indenture of trust executed on February 22, 1954, Keshavji settled upon trust properties of the value of Rs. 4,41,000 in favour of his minor grandchildren, Bipin and Kamla. On the same day Jaysinh, the son of the assessee, by another indenture of trust settled a sum of Rs. 1,54,000 upon his three sisters, Indumati, Kusum and Dipika.

(3.) IN disposing of the appeal preferred by the assessee's son, Jaysinh, the AAC, inter alia, observed: