TaxTMI 
TaxTMI 
2003 (1) TMI 75
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....subject to the agreement between the assessee and the donee dated September 27, 1964, could be included in the assessee's total income ? 2. Whether the gift deed dated September 27, 1964, by which the assessee gifted Shalini Palace to Chatrapati Shivaji Co-operative Education Society, had to be considered with the agreement of the same date between the assessee and the donee-society as part of the same transaction and whether in view of the said agreement there could not be said to be a gift to the donee absolutely until the conditions in the agreement were fulfilled ? 3. Whether on a proper interpretation of the gift deed dated September 27, 1964, as also the agreement dated September 27, 1964, between the assessee and the donee, i.e....
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....ical college and, therefore, the society asked for the property as narrated in item No. 1 above, from the donor as a gift without any consideration. According to by-law 2(3) of the donee-society, the board of directors have got a right to accept donation, on accepting the conditions as will be laid down by the donor. Accordingly it was requested by the chief promoters of the society that they will accept the said property as mentioned in para. 1 above as donation. Similarly, the promoters of the society also requested that permission may be given to give the name of the donor to the proposed medical college, considering the aims of the donee-society, the donor acceded to the request made by the promoters of the said society. The donor allow....
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....ociety." From the aforesaid clauses of the gift deed, it is evident that the gift was unconditional and irrevocable. As per the gift deed, possession of the gifted property was handed over to the donee-society and the donor had given up all his rights in the said property. On the same day, i.e., on September 27, 1964, the assessee entered into an agreement with the owner of the Palace, i.e., Chatrapati Shahaji Co-operative Education Society, Kolhapur, setting out the conditions for utilisation of the gifted property. One of the important conditions under the agreement was that the said society will pay to the assessee as compensation, a sum of Rs. 20,00,000 if the terms of the agreement for utilisation of the gifted property are not f....
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....the order of the Commissioner of Income-tax (Appeals). On the reference application filed by the Revenue, the Income-tax Appellate Tribunal has raised the aforesaid questions for the opinion of this court under section 256(1) of the Income-tax Act. We have heard Mr. Desai, learned senior counsel for the Revenue and Mr. V. H. Patil, learned senior counsel for the assessee. On a perusal of the gift deed dated September 27, 1964, it is seen that the gift of the property was irrevocable and under no circumstances was the gifted property to revert back to the assessee, On execution of the said gift deed the donee became the exclusive owner of the property and possession of the property was also handed over to the donee-society. As rightly con....
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....te of the gift deed. The Tribunal has rightly held that in the present case, the conditions for transfer of immovable property by gift as contemplated under section 123 of the Transfer of Property Act, 1882, have been complied with and accordingly the gift was a valid gift. The Tribunal has recorded a finding that in the sale deed executed by the donee-society in favour of the third party, the assessee is not shown as seller and only the donee-society is shown as seller. Moreover, even if the gifted property was sold for a higher amount, under the agreement the assessee was entitled to receive only Rs. 20,00,000 and not the entire sale amount. Under the circumstances, the Tribunal has rightly held that the gift deed is separate and disti....