1994 (2) TMI 34

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.... that shares of the beneficiaries are determinate is sustainable in law ? (2) Whether, on the facts and in the circumstances of the case, the assessment in the case of the assessee is not required to be made under the provisions of section 164 of the Income-tax Act, 1961 ? (3) Whether, on the facts and in the circumstances of the case, the assessee-trust is entitled to the allowances of interest paid to the beneficiaries ?" The relevant assessment year is 1975-76. The assessee is a family trust known as "Tanvi Sajni Family Trust" and it filed the return of income in respect of the said assessment year on June 29, 1975. The Income-tax Officer treated the trust as one in which the shares of the beneficiaries were determinate and defi....

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....h income or such part thereof were the total income of an association of persons, or (ii) at the rate of sixty-five per cent. whichever course would be more beneficial to the Revenue. It would, therefore, be clear that if the shares of the beneficiaries are determinate or definite, the provisions of section 164(1) would not be attracted. The question as to whether the shares of the beneficiaries are determinate or not is to be decided with reference to the trust deed in the instant case. A copy of the trust deed which was executed on January 31, 1973, refers to the shares of the beneficiaries, Kum. Tanvi Pankaj Dalal and Kum. Sajni Pankaj Dalal, in clauses 8(a) and (b) thereof, which read as under : "(a) Up to and including March 31, ....

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....ereby not only on March 31, 1997, but in each year up to March. 31, 1997. The provisions of clause 9 contained in the deed on which reliance is placed on behalf of the Revenue do not in any manner change the determinate character of the shares, as reflected from the above clauses 8(a) and (b). In our opinion, therefore, the Tribunal was right in holding that the shares of the beneficiaries are determinate. Since the shares of the beneficiaries are determinate, the provisions of section 164 of the Act would not apply in the instant case and the assessment is not required to be made under the provisions of section 164 of the Act. Questions Nos. 1 and 2 are, therefore, answered in the affirmative, in favour of the assessee and against the Reve....