TMI Blog2004 (4) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... ionary and what happened thereafter would not affect the validity of the trust. - The question is accordingly answered in the affirmative, i.e., against the Revenue - - - - - Dated:- 16-4-2004 - Judge(s) : N. K. SUD., HEMANT GUPTA. JUDGMENT The judgment of the court was delivered by N. K. Sud J. -This order will dispose of three Income-tax References Nos. 47 to 49 of the 1989. Income-tax References Nos. 47 and 48, relate to Smt. Gurmail Kaur Trust, Ludhiana, for the assessment year 1982-83 and 1983-84, whereas Income-tax Reference No. 49 relates to Smt. Kartar Kaur Trust for the assessment year 1981-82. The Income-tax Appellate Tribunal, Chandigarh Bench, Chandigarh (for short "the Tribunal"), vide its common order dated April 25, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... buted in accordance with the shares specified in the trust deed as the entire income had been distributed only to six beneficiaries. No share was given to the other beneficiaries. He further observed that under the terms and conditions of the trust, the trustees had no power to alter the shares of the beneficiaries. He was, therefore, of the view that the assessment for the assessment years 1980-81 and 1981-82 had been framed without examining the factual and legal implications of wrong distribution of income by the trustees. Accordingly, vide order dated March 28, 1985, passed under section 263 of the Act, he set aside the assessments for the two assessment years with a direction to the Income-tax Officer to re-examine the same. Pursuant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. The basis of this action was again the same as in the case of Kartar Kaur Trust. The assessee filed appeals against the action of the Income-tax Officer, before the Appellate Assistant Commissioner of Income-tax, Ludhiana, who vide order dated September 18, 1986, allowed the same on the basis of the reasons given by him in the appeal of Kartar Kaur Trust. The Tribunal has upheld this action. The sole question for consideration in these cases is as to whether the shares of the beneficiaries of two trusts are indeterminate or unknown. It has not been denied that in the trust deeds it has been clearly provided that all the children of the three sons of Gurmail Kaur were entitled to the benefits of the entire trust property in eq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant income' and 'beneficiaries', respectively) tax shall be charged on the relevant income or part of relevant income at the maximum marginal rate." A bare reading of above shows that it is only where individual shares of the persons on whose behalf or for whose benefit income is receivable by the trust are indeterminate or unknown, the tax can be charged on such income at the maximum marginal rate. Thus what has to be seen is as to whether as per the trust deed, the shares are indeterminate or unknown. It is an admitted position that shares are not indeterminate as per the trust deed. Wrong distribution of income by the trustees may affect the rights of the beneficiaries inter se for which various other consequences may ensue, but it cer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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