Representative assessee treatment applies where testamentary sale proceeds are charged for specified beneficiaries under a will.

Property bequeathed to an assessee vested in her, but the will charged the income and sale proceeds with a testamentary obligation for specified beneficiaries. On that basis, she was treated as a trustee under the testamentary instrument and therefore a representative assessee. The capital gains from the sale were accordingly assessable in her hands as representative assessee for each of her four daughters.

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Issues: Whether the capital gains arising from the sale of the Quilon property were assessable in the hands of the assessee or in the hands of her four daughters.

Analysis: The will bequeathed the property to the assessee, while directing that the income and sale proceeds be applied for the education and marriage of the grandchildren. On the terms of the will, the property vested in the assessee, but she held the income and sale proceeds subject to the testamentary obligation in favour of the daughters. In that situation, she answered the description of a trustee appointed under a testamentary instrument and, therefore, a representative assessee within the meaning of the Act.

Conclusion: The capital gains were assessable in the hands of the assessee as a representative assessee for each of her four daughters.

Ratio Decidendi: Where property is bequeathed to an assessee but the sale proceeds are charged with a testamentary obligation to be applied for specified beneficiaries, the assessee is assessable as a representative assessee under section 160 of the Income-tax Act, 1961.

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