TMI Blog1998 (6) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... rpretation of that provision. That section reads as under : "Subject to the provisions of sub-sections (2) and (3), where any income in respect of which the persons mentioned in clauses (iii) and (iv) of sub-section (1) of section 160 are liable as representative assessees or any part thereof is not specifically receivable on behalf, or for the benefit of any one person or where the individual shares of the persons on whose behalf or for whose benefit such income or such part thereof is receivable are indeterminate or unknown (such income, such part of the income and such persons being hereafter in this section referred to as 'relevant income', 'part of relevant income' and 'beneficiaries', respectively), tax shall be charged, (i) as if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the income received by the trustees does not vest with the beneficiary, that the beneficiary has no control over that income and has no right to compel the trustees to apply the income in the manner desired by the beneficiary, aud therefore it cannot be said that the income is received by the trustees on behalf of or for the benefit of the beneficiary. Counsel relied upon the decision of this court in the case of CIT v. T. G. K. Raman [1995] 214 ITR 11, wherein it was held that the income of the beneficiary under this trust could not be clubbed with the income of his father during the period of minority of the beneficiary, as the income did not vest in the beneficiary. Vesting of the income in the beneficiary is not a necessary prer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eficiary, solely for the benefit of such beneficiary. So long as that obligation is clear, the trust is not liable to be taxed at the highest marginal rate, In this case we are not concerned with the situation where there is a plurality of beneficiaries and the extent of whose interest in the income is indeterminate. Here there is only one beneficiary and all the income received by the trustees is to he held solely for his benefit. The several clauses in the trust deed do not in any manner permit the trustees to apply any part of the income so received for any purpose other than the benefit of the beneficiary. Learned counsel for the Revenue also relied upon the decision of the Bombay High Court in the case of CIT v. Hemant Bhunuhhai Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion of learned counsel, section 164(1) of the Act is required to br applied to the income of the trust. For the purpose of deciding the extent to which the statutory provision is attracted regard must first be had to the clear words used in the section, the context in which the section occurs, and the object of the enactment as a whole. It is not permissible to assume a state of affairs which the law intended lo discourage and thereafter read requirements into the section which are not spelt out in the section either explicitly or implicitly. If on a plain reading of section 164(1) it is clear that the conditions, which, if met, would render that section inapplicable, have been satisfied in a given case, it is impermissible to proceed t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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