Gift valuation must match the admitted extent of rights forgone, not an unsupported reduced percentage.

The assessee had admittedly gifted 20% of her interest in a partnership to her daughters-in-law. In those circumstances, there was no factual or legal basis for valuing the taxable gift at 10% of the recomputed three years' purchase value, because the admitted extent of the right forgone remained 20%. The Tribunal's direction to adopt 10% was inconsistent with that admitted gift and was therefore not justified. The valuation issue was answered against the assessee and in favour of the Revenue.

---

---

Issues: Whether the Tribunal was justified in law in directing that the value of the gift forgone be taken at 10% of the three years' purchase value.

Analysis: The assessee had admittedly gifted 20% of her interest in the partnership to her daughters-in-law. Once the gift was accepted on that basis, there was no factual or legal basis for reducing the taxable value of the right forgone from 20% to 10%. The Tribunal's direction to adopt 10% of the recomputed three years' purchase value was therefore inconsistent with the admitted extent of the gift.

Conclusion: The Tribunal was not justified in directing valuation of the taxable gift at 10% of the three years' purchase value. The question was answered in the negative and in favour of the Revenue.

---