Insurance premium under marriage property regime was not a gift, as payment discharged a contractual obligation rather than transferring property to the wife.

Insurance premia paid under a policy governed by the Married Women's Right to Property Act were not treated as a gift to the wife because the payment discharged an obligation under the insurance contract and did not effect an immediate transfer of property. The legal effect was that no element of gift arose from the premium payment, so it was not liable to gift-tax. The analysis relied on prior judicial authority that similar premia paid under a marriage property regime for the benefit of beneficiaries do not amount to gifts.

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Issues: Whether the insurance premium paid by the assessee under the Married Women's Right to Property Act constituted a gift in favour of his wife and was liable to gift-tax.

Analysis: The premium was paid in discharge of an obligation undertaken under the insurance contract and did not involve any immediate transfer of property to the wife. The payment was only toward satisfaction of the legal obligation attached to the policy, so no element of gift arose. The conclusion was supported by prior judicial authority holding that such premia, paid under a marriage property regime for the benefit of beneficiaries, do not amount to gifts.

Conclusion: The premium was not a gift in favour of the wife and was not liable to gift-tax.

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