Mandatory written consent for savings certificate transfers was essential, and statutory invalidity could not be cured by estoppel.

A transfer of national savings certificates was held invalid because the mandatory requirement of previous written consent under the governing law was not satisfied. The Court held that the prescribed authority's consent was a statutory condition for a valid transfer, and in its absence the transfer could not be legally effective. It further held that estoppel could not be invoked to validate an act rendered invalid by statute, and an intimation to the Gift-tax Officer did not cure the defect or change the legal position. The resulting gift-tax consequence was therefore unsustainable, and the assessee succeeded.

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Issues: Whether the transfer of national savings certificates was invalid for want of previous written consent under the governing savings certificates law, and whether the Revenue could still deny the exemption on the basis of an intimation made to the Gift-tax Officer.

Analysis: The governing provision required previous consent in writing for a valid transfer of a savings certificate, and the relevant rule identified the prescribed authority. Since no such consent had been obtained, the transfer could not acquire legal validity. The Court further held that a party cannot rely on estoppel to sustain or validate an act which the statute itself declares invalid, because there can be no estoppel against statute. Any intimation to the Gift-tax Officer did not cure the statutory defect or alter the legal position.

Conclusion: The gift was invalid for non-compliance with the statutory requirement, and the Tribunal was right in holding that the inclusion of Rs. 32,500 was not sustainable; the question was answered in the affirmative in favour of the assessee.

Ratio Decidendi: A transfer expressly made invalid by a mandatory statute cannot be validated by conduct or estoppel, and statutory non-compliance defeats the claimed tax consequence.

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