TaxTMI 
TaxTMI 
2005 (6) TMI 265
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....sessee was having 50 per cent share. The assessee's three sons purchased the portion of the property belonging to his uncle, Shri Hiralal. On 1st April, 1991, the assessee relinquished his 50 per cent share in the said property in favour of his three sons, who were otherwise the co-owners of the 50 per cent share of the said property. Consequently, there were four co-owners in the said property, each having 25 per cent share. While relinquishing the 50 per cent share out of 50 per cent share belonging to the assessee to the said sons, according to the AO, there was a transfer as per s. 4 of the GT Act, 1958. The value of the property relinquished was taken at Rs. 1,77,680 as declared in the return of income. The assessee claimed the same to....
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.... the family members consisting of assessee, his wife and three sons. As the disputes were going on, the same could not be resolved by means of inter se dialogues and discussions, the same were, therefore, resolved as per the advise and intervention of the close relatives and well-wishers. The terms of the memorandum further provided that one of the sons of the assessee, Shri Narendra Kumar, should go to reside separately by separating himself from the family with his wife and children. Similarly, Shri Rajendra Kumar, other son of the assessee and party of the fourth part of this memorandum, should go to reside separately by separating himself from the family with his wife and children within six months of this family arrangement. The remain....
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....sidering the circumstances at that time, Shri Dhami Jawahar Amarchand and the assessee again decided for partitioning the plot owned by the assessee and his sons in joint ownership, wherein the assessee was having 50 per cent share and his three sons, Shri Narendrabhai, Rajendrabhai and Shri Nileshbhai, were jointly having remaining 50 per cent share. By way of settlement, it was agreed that all the four of them will be having 25 per cent share equally and on 1st April, 1991, one memorandum of agreement for such understanding was entered into declaring that each of them is having 1/4th share therein. We had also gone through carefully the affidavits of Shri Vala Pratapsinn Naranbhai, Shri Rasiklal Chhaganlal Salot, stating therein similar f....
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....e in the family. The Hon'ble Gauhati High Court in the case of Ziauddin Ahmed vs. CGT 1976 CTR (Gau) 161 : (1976) 102 ITR 253 (Gau) have held that allocation of shares held by the deceased assessee and his son allotted to different members of family to resolve the existing and future disputes was family arrangements and not a transfer, therefore, provisions of s. 4(1)(a) cannot be invoked. Similar view has been taken in the case of CGT vs. S.N. Zaman & S.M. Elahi (1997) 137 CTR (Gau) 385 : (1996) 221 ITR 842 (Gau). 5. In order to appreciate the submission of Mr. Patel, it is to be seen what constitutes a family settlement. Family settlement is made just to avoid dispute to maintain the honour and dignity of a family. It is neither a partit....