1997 (2) TMI 19 - HC - Income Tax

Summary

The High Court of Madras ruled in favor of the assessees in a gift-tax case for the assessment years 1970-71 and 1971-72. The court held that the transfer was not without adequate consideration, thus the assessees were not liable for gift-tax under section 4(1)(a) of the Gift-tax Act, 1958. The Tribunal found that the consideration for the transfer was not less than the market value, and therefore, there was no deemed gift. The court emphasized that as long as the consideration is reasonable or fair, it cannot be deemed inadequate. Consequently, the court answered the question in favor of the assessees.