COMMISSIONER OF GIFT TAX Vs. PORWAL UDYOG INDIA

JUDGEMENT

(1.) R. C. Mukati, counsel for the applicant, was heard on the question of admission.

(2.) THIS is an application filed by the applicant under Section 26(3) of the Gift-tax Act, 1958, calling upon the Income-tax Appellate Tribunal, Iridore, to make a reference to this court on the following question of law proposed by the applicant :

(3.) SIMULTANEOUSLY, gift-tax proceedings were also commenced against the respondent-assessee on the basis that it was a deemed gift. However, when the matter went up before the Tribunal, relying on the Supreme Court decision in K. P. Varghese v. ITO [ 1981 ] 131 ITR 597 it came to the conclusion that capital gains and gift-tax could not stand together as they arose out of one and the same transaction and, therefore, ultimately declined to make a reference to this court as submitted by the applicant.