Gift-tax exemption for a doctor's property transfer upheld where the gift facilitated the medical profession and met statutory conditions.

A gift made by a practising doctor of his hospital and adjoining land to his son qualified for exemption under section 5(1)(xiv) of the Gift-tax Act, 1958 because it was made while the medical profession was being carried on and was connected with that profession. The court held that "in the course of" was satisfied on the admitted facts of ongoing practice, and that the "for the purpose of" requirement was met where the gift was made on grounds of commercial expediency to directly or indirectly facilitate the profession; actual profit or immediate benefit was not required. The assessee was therefore entitled to the exemption.

---

---

Issues: Whether the gift of the hospital and adjoining land by a practising doctor to his son qualified for exemption under section 5(1)(xiv) of the Gift-tax Act, 1958, as a gift made in the course of carrying on the profession and for the purpose of such profession.

Analysis: The exemption under section 5(1)(xiv) required satisfaction of two conditions: the gift must be made in the course of carrying on a business, profession or vocation, and it must be made for the purpose of such business, profession or vocation. The Court found that the assessee was admittedly carrying on his medical profession at the time of the gift, and held that the expression "in the course of" was satisfied on those facts. On the second condition, the Court held that it was enough if the gift was made on grounds of commercial expediency and to directly or indirectly facilitate the carrying on of the profession; actual accrual of benefit or an intention to earn profit was not necessary.

Conclusion: The gift fell within section 5(1)(xiv) of the Gift-tax Act, 1958, and the assessee was entitled to the exemption.

---