Adequate consideration defeats deemed gift claim where Revenue cannot prove undervaluation or tax evasion.

Transfer of property supported by adequate consideration did not attract a deemed gift under section 4(1)(a) of the Gift-tax Act where the Revenue failed to prove undervaluation or any device to evade tax. Mere later computation of a higher market value was insufficient to show that the consideration received was inadequate. In the absence of material establishing evasion or undervaluation, the burden on the Revenue was not discharged and no deemed gift arose.

---

---

Issues: Whether the transfer of property was for adequate consideration so as to avoid a deemed gift under section 4(1)(a) of the Gift-tax Act.

Analysis: The Revenue had to establish that the assessee undervalued the property and attempted to evade tax. The mere fact that the Department later computed a higher market value did not by itself prove that the consideration received was inadequate or that any device to evade gift-tax had been adopted. In the absence of material supporting the allegation of undervaluation or evasion, the burden placed on the Revenue was not discharged.

Conclusion: The transfer was held to be supported by adequate consideration and no deemed gift arose within the meaning of section 4(1)(a) of the Gift-tax Act.

---