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1966 (10) TMI 53 - SC - Income TaxWhether, after the execution of the deed of surrender on 21st July, 1955, the income from the trust properties was exempt from income-tax under section 4(3)(i) of the Act or not? Held that:- The exemption of the income of the trust properties from liability to income-tax was not dependent entirely on the coming into operation of clause 8, and we, therefore, think that the question framed should have been broken up into two parts as follows: "(1) Whether clause 8 of the trust settlement made on 25th November, 1946, came into operation immediately following the declaration made by Bai Kasturbai on 21st July, 1955 ? and (2) Whether, in the circumstances of this case, the income that accrued or arose to the trustees from the trust properties from 21st July, 1955, onwards, was exempt under section 4(3)(i) of the Act ?" If the question is so broken up, the first question becomes unnecessary, and the second question has to be answered in favour of the respondent. The answer to the second question is the only one that is material for purposes of determining the liability of the income of the trust to tax. That question has been answered by the High Court in favour of the respondent. The appeals, therefore, fail
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