9911796707
TMI Blog1972 (11) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... o questions of law referred to the High Court are: " 1. Whether on a true construction of the indenture of trust dated June 11, 1941, the trustees of the trust constitute an assessable unit under the provisions of the Wealth-tax Act ? 2. Whether the property held by the trustees under the identure of trust dated June 11, 1941, is held for any public purpose of a charitable or religious nature in India within the meaning of section 5(1)(i) of the Wealth-tax Act? " The High Court has answered both these questions in favour of the department and against the assessee. Hence, these appeals. The facts of this case lie within a narrow compass. Govindram Gordhandas Seksaria, Ramnath Gordhandas Seksaria, Makhanlal Gordhandas Seksaria and Bho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) may be expended or given for the purpose of meeting the expenses of marriage of any poor male Vaishaya Hindoo who may be deserving of help. (u) Rs. 500 (rupees five hundred) may be expended or given for the purpose of meeting the expenses of marriage of any poor female Vaishaya Hindoo who may be deserving of help." The deed further provides: " If the income of the trust estate is not sufficient to carry out the charities specified in sub-clauses (a) to (u) above the charity specified in an earlier sub-clause shall be given priority over a charity specified in a later sub-clause." From the above, it is clear that charity provided was primarily for the benefit of the members of the family of Seksaria, no doubt including both male an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng on and from the first day of April, 1957, a tax (hereinafter referred to as wealth-tax) in respect of the net wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in the Schedule." Section 5 provides for exemption in respect of certain assets. One of the exemptions provided is in respect of any property held by an assessee under trust or other legal obligation for any public purpose of a charitable or religious nature in India. Section 21 to the extent material for our present purpose may be recast thus : " In the case of assets chargeable to tax under this Act which are held by a trustee appointed under a trust declared by a duly executed instrument in writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hence, trustees cannot be assessed to tax under the Act. That contention was rejected by this court. No contention was raised in that case that trustees did not come within the scope of section 3 of the Act. The judgment in that case proceeded on the basis that trustees can be assessed to wealth-tax in respect of the trust property of which they are trustees. There is also no dispute that section 5(1)(i) of the Act proceeds on the basis that a trust property comes within the scope of the Act. Section 3 of the Act does bring within its scope an individual which expression in view of the Central General Clauses Act includes individuals as well, unless the context otherwise indicates. In this case, the context, far from not indicating that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Marumakkattayam family could also be assessed as an individual. In Suhashini Karuri v. Wealth-tax Officer, Calcutta the Calcutta High Court opined that joint trustees could be assessed as individuals under the Act. A similar view was taken by the Bombay High Court in Abhay L. Khatau v. Commissioner of Wealth-tax. We are in agreement with that view. We, accordingly, agree with the High Court and hold that the trustees of the trust, with which we are concerned in these appeals, constitute an assessable unit under the provisions of the Act. Now, let us turn to the other question, viz., whether the trust in question can be considered as a trust created for public purpose of a charitable or religious nature. As seen earlier, the trust in qu ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
