9911796707
TMI Blog1987 (11) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... tain debts incurred by the partners. According to the revenue, since the conveyance of the properties belonging to the assessee was not in discharge of any debt incurred by themselves it was without consideration and hence assessable as gifts. According to the assessees this conveyance amounted to a family arrangement to save the honour of the family and hence it was not without consideration and could not be regarded as a gift. The assessees relied on the decision of the Supreme Court in the case of Ram Charan Das v. Girja Nandini Devi AIR 1966 SC 323. But the CGT (Appeals) rejected the claim on the ground that the document made no reference to saving of honour of the family or not even a reference to the family and that it only amounted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees and, therefore, the gift-tax assessments should be upheld. 2. On a consideration of the rival submissions, we are of the opinion that the assessees are entitled to succeed. The essential of a family settlement and the principles governing the existence of the same have been succinctly summarized in Halsbury's Laws of England, Vol. 17, Third Edition, pp. 215-216 as follows : "A family arrangement is an agreement between members of same family, intended to be generally and reasonably for the benefit of the family either by compromising doubtful or disputed rights or by preserving the family property or the peace and security of the family by avoiding litigation or by saving its honour. The agreement may be implied from a long course of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty so that the rest of their properties will not be attached by the creditors. As pointed out by the Supreme court every party who takes benefit under a family arrangement need not necessarily be shown to have, under the law, a claim to a share in the property. All that is necessary to show is that the parties are related to each other in some say and have a possible claim to the property or a claim or even a semi balance of a claim on some other ground as, say, affection. In the present case it is not in dispute that the assessees are related to the donees and the necessary implication of the transaction is that in the normal course of human conduct the assessees have discharged what in their minds was their obligation to meet the debts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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