TMI Blog1968 (2) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... on which a decision of the question referred depends are clauses 2(a) to 2(e) which were as follows : " (a) To recover the dividends, interests, and income of the trust fund and to pay out of the same the charges for collection and all other outgoings, if any. (b) To pay the balance of such interest, dividends and income, hereinafter,called ' the net income ' of the trust fund to the said Hansa so long as the said Hansa continues to be and remains the wife or widow of the said Tribhuwandas Haridas. (c) In the event of a son or sons being born to the said Hansa then on the said Hansa ceasing to be the wife or widow of the said Tribhuwandas Haridas, to divide the corpus of the trust fund amongst all the sons of the said Hansa, if more than one, in equal shares. (d) In the event of no son or sons being born to the said Hansa and in the event of a daughter or daughters being born to the said Hansa,, then on the said Hansa ceasing to be the wife or widow of the said Tribhuwandas Haridas to divide the corpus of the trust fund amongst all the daughters of the said Hansa, if more than one, in equal shares. (e) In the event of no child being born to the said Hansa then on the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pended upon " certain contingencies happening ". The Appellate Assistant Commissioner upheld this decision. He held that " Hansa Tribhuwandas has no right in the corpus which is only distributable on her death and the shares of the persons who would be entitled to the corpus are clearly indeterminate. Section 21(4), therefore, clearly applied to the facts of the case ". He also held that " the consideration in the assessment of the beneficiary of the value of her life interest is not in any way improper as it is one of her assets whose present value or benefit has to be evaluated and included ". He, therefore, held that " the sum of Rs. 5,24,941 considered as the value of life interest of the beneficiary is allowed as a deduction in the appellant's hands ". So far as this part of the Appellate Assistant Commissioner's order is concerned, it was not subsequently challenged. The assessees appealed to the Tribunal and the Tribunal has reversed the decision of the Wealth-tax Officer and the Appellate Assistant Commissioner. The view which the Tribunal took was that, having regard to the provisions of the two deeds, " it would be clearly possible by any competent actuary to determine th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ased by births and deaths and an argument similar to the one which has been advanced before us had been advanced by Mr. Joshi that if upon a proper construction of clause (g) of the deed of trust, it should be held that the provision is in favour of a class of grandchildren of the settlor existing or to be born and that class is a fluctuating class and necessarily indeterminate. The shares of the grandchildren would be, liable to variation, if some would die and new ones may be born." We negatived that contention by holding : " It was further urged that, so long as the shares themselves are liable to alteration or fluctuation, it cannot be said that those shares are determinate. No doubt it is possible upon the terms of the trust deed that even after becoming entitled to a share in the trust property after the lifetime of their parents, the share of the grandchildren may in certain contingencies be augmented, as for instance, at the death of the unmarried daughter. Such a contention cannot be sustained because, so far as the incidence of the wealth-tax is concerned, it is the incidence on the 'relevant date' that we have to consider. The question whether the shares of the benefic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant date Hansa would be entitled to the entire income of the trust fund and the heirs of Tribhuwandas according to law would have a contingent interest in the corpus of the trust property. There was only one heir of Tribhuwandas on that date, namely, the son of Nanalal, and he, therefore, had the contingent interest in the entire corpus. We do not see what was indeterminate or unknown in this trust deed as regards the shares. Hansa clearly had only the interest given to her in the net income and had no right in the corpus of the property whereas the son of Nanalal had on the relevant date a contingent interest in the corpus of the trust property, contingent upon Hansa " ceasing to be the wife or widow of the said Tribhuwandas ", which as we have said, in our opinion, would also cover the case of her death. Mr. Joshi attempted to argue that Hansabai also must be deemed to have an interest in the corpus of the trust fund, because without being interested in the corpus she could not be interested in the income from the trust fund. Now, it is no doubt true that the income from the trust property was to come out of the corpus, but the holder of the share in the income could not, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aving regard to that expression it was impossible to say whether the shares of Hansabai or of Tribhuwandas and/or the sons of Nanalal were determinate or known. No doubt, it would be perhaps a difficult thing to compute and determine the share in the case of a life interest or in the case of a contingent remainder but the difficulty of computation should not come in the way of the application of the law which speaks of " the shares of the persons on whose behalf or for whose benefit any such assets are held being indeterminate or unknown. It is always possible by actuarial calculations to assess the present worth of a life interest such as Hansabai had or a contingent remainder such as the heirs of Tribhuwandas have under the first deed or a contingent interest as Tribhuwandas himself had under the second deed or a contingent interest which the sons of Nanalal have under the second deed. What is, therefore, pointed out is more a difficulty of computation or ascertainment and not that the share itself was indeterminate or unknown. In our opinion, the case is clearly covered by the principles which we have accepted in Trustees of Pullibai R. F. Mulla Trust v. Commissioner of Wealth-t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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