COMMISSIONER OF INCOME TAX Vs. ATREYA TRUST

JUDGEMENT

(1.) THE Tribunal has referred the following question of law to this Court under s. 256(1) of the IT Act, 1961 ("the Act") : "Whether, on the facts and in the circumstances of the case, the Tribunal is justified in holding that the income of the trust is specifically receivable for the benefit of the individuals who are determinate and known and, as such, s. 164(1) of the IT Act, 1961, is not attracted ? "

(2.) THE assessment year involved is 1981-82 for which the relevant accounting period is the financial year ended on March 31, 1981. The facts of this case relevant for the purpose as evidenced from the statement of the case are as follows :

(3.) THE provisions of s. 164 of the Act were made explicit by the Explanation which was inserted w.e.f. April 1, 1980. In the instant case, the assessment year involved is 1981-82 and the said Explanation clearly applies to the instant case. In view of such an Explanation, the benefit of s. 164 could not be obtained unless the beneficiary was known and determinate. In the instant case, the beneficiary was the would be wife of Atreya Lakhotia. In the instant case, it is not a fact that the marriage has been fixed and the would be wife is identifiable. The trust deed provides that the trust was for the benefit of the would-be wife who was not in existence when the trust was created and there was no certainty that such a marriage would ever take place to fulfil the object of the trust.