Ownership for income-tax purposes depends on legal control and entitlement to income, not a mere residual beneficial interest.

For section 9 of the Income-tax Act, 1922, "owner" means the person who can exercise legal rights of ownership in his own right and is entitled to the property's income. Where evacuee property vested in the Custodian under the Pakistan (Administration of Evacuee Property) Ordinance, 1949, the Custodian's powers to possess, manage, realise income from, alienate and restore the property displaced the assessee's ownership for tax purposes. A mere residual or beneficial interest was insufficient. On that basis, the assessee was not treated as owner during the relevant assessment years and the deduction claim failed.

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Issues: Whether, for the purposes of section 9 of the Income-tax Act, 1922, the assessee continued to be the owner of the property after it vested in the Custodian under the Pakistan (Administration of Evacuee Property) Ordinance, 1949.

Analysis: The property had vested in the Custodian, who was empowered to possess, manage, realise income from, alienate and, in appropriate cases, restore evacuee property. The Court held that section 9 of the Income-tax Act, 1922 taxes the income from property in the hands of the owner, and that the relevant owner is the person who can exercise the rights of ownership in his own right and is entitled to the income. A mere residual or beneficial interest, without the powers of legal ownership, was held insufficient. On that footing, the assessee could not be treated as owner during the relevant assessment years.

Conclusion: The assessee was not the owner of the property for the purpose of section 9 of the Income-tax Act, 1922, and the claim for deduction failed.

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