TMI Blog2020 (10) TMI 1095X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of CIT vs. M/s.TVS Shriram Growth Fund [ 2020 (10) TMI 665 - MADRAS HIGH COURT ] section 164 of the Act gets attracts only when the shares of the beneficiaries are unknown, which is manifest from the marginal heading of that Section itself, viz., Charge of tax where the share of the beneficiaries unknown. That Section comes into play only where any income or any part thereof is not specifically receivable on behalf of 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, and in such case, the relevant income, or part of the relevant income shall be charged at the maximum marginal rate. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd law the Tribunal was right in law in holding that the entire receipt is taxable in the hands of assessee even though the income and expenditure have been distributed and intimated to the beneficiaries? 4.Whether on the facts and circumstances of the case and law the Tribunal was right in law in holding that entire income is taxable in the hands of the assessee even though ignoring the evidence that some of the beneficiaries have offered the income in their return of income? 5.Whether on the facts and circumstances of the case and law the Tribunal was right in law in holding that part of income assigned to another trust M/s.TVS Shriram Growth Fund on behalf of the same beneficiaries and assessed in their hands should not be excluded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Deed, but shown as beneficiaries and are identifiable and having been assessed whether the Trust can be assessed again. In fact, the Tribunal ought to have followed the decision of the Division Bench of this Court in the case of P.Sekhar Trust (supra). However, the same has been distinguished by the Tribunal in the case of TVS Investments I Fund by observing that the said judgment is not applicable to the facts of the case because in it, the beneficiaries are incorporated on the day of the institution of the Trust Deed and moreover, they did not receive any income in that year. Unfortunately, the Tribunal in the case of TVS Investments I Fund, did not fully appreciate the finding rendered by the Hon'ble Division Bench of this Court a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade upon him in his representative capacity only, and the tax shall, subject to the other provisions contained in Chapter XV, be levied upon and recovered from him in like manner and to the same extent as it would be leviable upon and recoverable from the person represented by him. 12. ................ 13. ................ 14. ................ 15. ................ 16.. Thus, the scheme of the Act, the statutory provisions, as well as the line of judgments referred to above clearly state that though Section 5 referred to total income of the person whose income is being assessed and the charge on income tax under Section 4 of the Act is on the total income, what could be taxed in the hands of the representative assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the beneficiaries on whose benefit, such income or such part thereof is receivable are indeterminate and unknown. 19.The legal position qua the applicability of provisions of Section 14(1) of the Act has been thoroughly examined by the Tribunal and by an elaborate order, the Tribunal has held in favour of the assessee. We find that the Tribunal rightly took note of the statutory provisions and the law governing this subject and arrived at a conclusion. The view taken by the Bangalore Bench of the Tribunal was affirmed by the High Court of Karnataka on the following terms:- 6. As such, in our view the matter should rest as the finding of fact for the simple reason that whether the Trust Deed provides for shares of the beneficia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ords, in proportion to the investment made. Once the benefits are to be shared by the beneficiaries in proportion to the investment made, any person with reasonable prudence would reach to the conclusion that the shares are determinable. Once the shares are determinable amongst the beneficiaries, it would meet with the requirement of the law, to come out from the applicability of Section 164 of the Act. 11. Under the circumstances, we cannot accept the contention of the Revenue that the shares were non-determinable or the view taken by the Tribunal is perverse. On the contrary, we do find that the view taken by the Tribunal is correct and would not call for interference so far as determinability of the shares of the beneficiaries are c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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