TMI Blog1999 (9) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the appellant is liable to gift-tax for the amount of Rs. 1,25,000 ? 2. Whether, the Appellate Tribunal was justified in not adjudicating on the question of the applicability of section 4(1)(a) and section 4(1)(c) of the Gift-tax Act to the facts of the instant case ? 3. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal erred in not considering the question as to whether the assessee was entitled for exemption under section 5(1)(xiv) of the Gift-tax Act?" The facts as presented by the parties are essentially as follows : M. A. Ismail (hereinafter referred to as the assessee) along with his brother Dr. Abdulla, was carrying on business on a partnership basis as exhibitors of cinematographic films, u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the superstructure was built, was agreed upon at Rs. 3,00,000. After deducting Rs. 75,000 towards the assessee's share in the property, and allowing exemption under section 5(2) of the Act, the taxable gift was arrived at Rs. 2,20,000 and tax was levied. The matter was carried in appeal before the Commissioner of Gift-tax (Appeals) (hereinafter referred to as the appellate authority), who, by his order dated February 13, 1989, upheld the assessment. A second appeal was preferred before the Tribunal, which also did not give any relief to the assessee. An application filed under section 26(1) was also rejected. The assessee moved this court under section 26(3) of the Act for its opinion on the questions referred to above. Mr. P. Bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, which reads as follows : " 'Gift' means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consideration in money or money's worth, and includes the transfer or conversion of any property referred to in section 4, deemed to be a gift under that section." It may be that in a given case the value as on the date of transfer may not be the same as that taken for some other purpose like determining the value of the assets at the time of dissolution. It would depend upon the time gap between the two events. In the instant case, it has been found by the authorities that the value for the purpose-of working out the value of the assets came close on the heels of the date of transfe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conceive of evaluating the consideration acquired by the partner when he brings his personal asset into the partnership firm when neither can the date of dissolution or retirement be envisaged nor can there be any ascertainment of liabilities and prior charges which may not have even arisen yet. Therefore, the consideration which a partner acquires on making over his personal asset to the firm as his contribution to its capital cannot fall within the terms of section 48. And as that provision is fundamental to the computation machinery incorporated in the scheme relating to the determination of the charge provided in section 45, such a case must be regarded as falling outside the scope of capital gains taxation altogether." Every alienati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-section. "Intent" can be equated with "object" and "objective". The crucial question is how to prove existence of intent and how to decide whether the transaction was or was not entered into with the required intent. The fact that the transaction had the effect described will not by itself be sufficient. It would depend upon the factual background of each case. The essence of the clause is, as indicated above, the diminution in the value of the property of the donor and increase of the value of the property of the donee. The provision does not require that the diminution and increase in value must necessarily be equal or correspond in amount. The purpose seems to rope in artificial devices which are intended to confer a gift on the donee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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