RAJENDRA SINGH S Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference under s. 256(1) of the IT Act, 1961, at the instance of the assessee for answering the following question of law, namely:

(2.) THE material facts are these. THE assessee is a lawyer practising at Jabalpur. A flat was purchased at Bombay in the name of the assessee's wife in the year 1962-63. In the gift deed dt. October 26, 1970, executed by the assessee in favour of his wife, it was stated that the amount of Rs. 50,000 paid as consideration for purchase of the flat in the name of the assessees' wife, was gifted by the assessee to his wife and that the assessee had relinquished his right to recover the amount paid to his wife. For the relevant asst. yr. 1976-77, for which the accounting period ended on March 31, 1976, a dispute arose about the inclusion of Rs. 1,260 in the assessee's income which represented the interest which had accrued on the rental income of the flat deposited during that period in the bank account of the assessee's wife. By this view taken by the Tribunal on the question of income as also on some other points decided by the Tribunal, the assessee felt aggrieved and an application was made under s. 256(1) of the Act for reference to this Court of these three questions of law, namely:

(3.) WE shall now consider the question which has been referred to us for decision. The question is whether the Tribunal was justified in its conclusion that the assessee made a cash gift of Rs. 50,000 and not gift of the property purchased out of it by virtue of the gift deed dt. October 26, 1970. Learned counsel for the assessee states that the assessee does not require a decision of the question in the present case, in view of our conclusion that the application, I.A. No. 4900 of 1985, cannot be allowed. It is, therefore, not necessary to answer this question and for that reason we decline to answer the same.