COMMISSIONER OF INCOME TAX Vs. PATUCK C N

JUDGEMENT

(1.) THE question referred for our decision in this reference is : 'Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction of Rs. 3,000 paid to the unmarried daughter from his total income of the previous years relating to the assessment years 1957 -58 and 1960 -61 ?'

(2.) THE circumstances under which this question comes to be referred are as follows : C. N. Patuck was assessed as an individual in the relevant assessment years. He was a partner of a firm known as Messrs. Patuck and Sons. From this firm he derived an income from two sources. He had a one -third share in the profits of the partnership and was receiving Rs. 400 per month as his salary.

(3.) THE decree contemplated that an agreement would be entered into and such an agreement was entered into on the 4th April, 1951. It was a tripartite agreement between the firm of Messrs. Patuck and Sons, the assessee himself and his two daughters and the relevant portion of that agreement was as follows : 'By a Deed of Partnership dated 23rd October, 1944, and entered into between Mr. Cowasji Nusserwanji Patuck and ourselves a monthly sum of Rs. 400 as and by way of remuneration and one -third share in the profits of the partnership business is payable to Mr. Cowasji Nusserwanji Patuck as a partner. We have been informed and taken notice of the following provision made for you by out partner Mr. Cowasji Nusserwanji Patuck as a part of the consent terms in Parsi Chief Matrimonial Suit No. 16 of 1951 between him and his wife Shera Cowasji Patuck : 'The plaintiff (i.e., Cowasji Nusserwanji Patuck) agrees to pay his daughter Jeroo a monthly sum of Rs. 250 and to his daughter Sooni a monthly sum of Rs. 250. Such sums shall be paid to each of them till her marriage. The payments shall be made on or before the 10th day of each month. In the event of the marriage of each of the said daughters Jeroo and Sooni, the plaintiff (i.e., Cowasji Nusserwanji Patuck) shall pay to each of them a sum of Rs. 10,000 on the marriage of each of them. In order to secure regular payment of the above sums an agreement will be entered into between the plaintiff (i.e., Cowasji Nusserwanji Patuck), the said two daughters and the partners of Messrs. Patuck Sons and Co. agreeing to pay each of them the monthly sum of Rs. 250 respectively out of the remuneration and profits payable to the plaintiff (i.e. Cowasji Nusserwanji Patuck) from the said partnership firm. In the event of the partnership firm being dissolved or in the even of the retirement of the plaintiff (i.e., Cowasji Nusserwanji Patuck) from the said partnership or in case of his death the payment of the sums mentioned in this clause shall constitute a first charge on the share of the plaintiff (i.e., Cowasji Nusserwanji Patuck) in the said partnership and if and when required the plaintiff (i.e., Cowasji Nusserwanji Patuck) will execute a document for that purpose.' In consideration of the above premises and in further consideration of the sum of Rs. 5 paid to us by Mr. Cowasji Nusserwanji Patuck and Rs. 5 paid to us by you two we agree to pay to each of you out of the remuneration and one -third share in the profits of the aforesaid partnership, such payment to be made by cheque on or before the 10th of each month.'