TMI Blog1967 (8) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... n, Badri Prasad, who had a six annas share. On the 18th April, 1956, the deceased's capital account in the books of the firm was debited with the sum of Rs. 50,000 and two sums of Rs. 25,000 each were credited to the accounts of his two grandsons, Shri Narayan Khemka and Laxminarayan Khemka, opened in the books of the firm. On the 19th April, 1956, a deed of partnership was entered into between the deceased, Badri Prasad, Shri Narayan and Laxminarayan wherein it was recited that the gift of Rs. 25,000 each made by Gourdhandas to Shri Narayan and Laxminarayan would be treated as their respective capital contribution to the firm constituted under that instrument and that the business formerly carried on by the firm of two partners would now b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion he relied on the decision of the Privy Council in the case of Clifford John Chick v. Commissioner of Stamp Duties. He, therefore, included the amount of Rs. 75,000 in the principal value of the estate passing on the death of the deceased. On appeal by the accountable person against the order of assessment, the Appellate Controller of Estate Duty recorded an admission by the authorised representative of the accountable person that the deceased did not execute anything in writing directing the firm to transfer the amounts of the alleged gifts from his account to the accounts of the alleged donees and also that there was no sufficient cash balance with the firm at the time of the alleged gifts. The Appellate Controller held that the prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ram Ramanath v. Commissioner of Income-tax and held that there were no genuine and valid gifts made by the deceased to his grandsons. In view of the aforesaid finding, the Tribunal did not consider whether the amount should be included in the estate passing on the death of the deceased under section 10 of the Estate Duty Act. At the instance of the accountable person the following questions of law had been referred to this court by the Tribunal : " (1) Whether, on the facts and in the circumstances of the case, valid gifts to the tune of Rs. 75,000 were made by the deceased in favour of his four grandsons by merely effecting transfer credit entries in the books of the firm ? (2) If the answer to the above question is in the affirmativ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The question as framed and referred to this court is capable of only one answer, which must be in the negative. If the question was wide enough for us to take into consideration the subsequent events, we would have been bound to hold that the deed of partnership itself would constitute an act of acceptance by the donees of the gifts. Mr. Chakraborty referred us to the decision of the Madras High Court in P. A. C. Ratnaswamy Nadar Sons v. Commissioner of Income-tax, where the Madras High Court had held that the entries in the account books could be relied upon as affording cogent evidence of the gift. Though the entry as such might not conclusively establish a real and effective gift, it was evidence in support of the gift. The subse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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