Home Case Index All Cases Income Tax Income Tax + SC Income Tax - 2015 (11) TMI SC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (11) TMI 398 - SC - Income TaxTrusts for the benefit of two minor children - provisions of section 64(1)(iii) invoked - the Assessing Officer included the said income in the income of the assessee and taxed as such - Held that:- No doubt two minor children of the appellant were the beneficiaries under the two trusts. It is also not in dispute that the said trustees were the partners in the firm and had their shares in the income as partners in the said firm. However, the entire controversy revolves around the question as to whether it could be treated as income of a "minor child". This controversy has arisen because of the reason that the income that had been earned by the trustees was not available to the two minor children till attaining the age of majority. As pointed out above, this was one of the conditions contained in the trust deeds that the income so generated by the trust, shall not be given to or spent for the benefit of the minor children till they attain majority and the money was to be handed over to them only on attaining the majority which would mean that the income was available to these persons when they cease to be the minors. This very question came up before this court in almost identical circumstances in the case of CIT v. M. R. Doshi [1994 (9) TMI 3 - SUPREME Court] wherein held as in this case the deferment of the benefit is beyond the period of minority of the assessee's three sons, since the assets are to be received by them when they attain majority, the provisions of section 64(1)(v) have no application. In the present case, as pointed out above, specific stipulation which is contained in both the trust deeds is that in case of demise of any of the minor the income would accrue to the other child. Therefore, the receipt of the said income is also contingent upon the aforesaid eventuality and the two minors had not received the benefit immediately for the assessment year in question, viz., as "minor" children. Thus High Court [2003 (10) TMI 33 - UTTARANCHAL High Court ] does not lay down the correct proposition of law.
|