Void transfers under land reforms law cannot support gift-tax when the statute declares them non est for all purposes.

Settlement deeds executed after the notified date but before publication of the section 18(1) notification under the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961 were treated as void under section 23, as amended with retrospective effect. A statutory declaration that a transfer is void renders it non est for all purposes, not merely for land reforms administration, so the deeds could not constitute valid gifts capable of attracting gift-tax. Because the transfers were void, it was unnecessary to examine whether acceptance or consent of the donees was required under the Gift-tax Act.

---

---

Issues: Whether the settlement deeds executed after the notified date and before publication of the notification under section 18(1) of the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961 were void under section 23 of that Act and, if so, whether they could still be subjected to gift-tax.

Analysis: The settlements were executed after the notified date and before the publication of the notification under section 18(1). Section 23, as amended with retrospective effect, declared such transfers void. A statutory declaration that a transaction is void renders it non est in law for all purposes and not merely for the purpose of the land reforms law. The Court therefore held that the settlement deeds could not be treated as valid transactions capable of attracting gift-tax. In view of this conclusion, it was unnecessary to decide whether acceptance or consent of the donees was required under the Gift-tax Act.

Conclusion: The settlement deeds were void under section 23 of the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961 and were not liable to gift-tax; the answer was in favour of the assessee and against the Revenue.

Ratio Decidendi: A transfer declared void by a statute with retrospective effect is void for all purposes and cannot form the basis of a taxable gift.

---