TaxTMI 
TaxTMI 
1984 (1) TMI 96
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....equal shares in the income in this declaration also, nothing was stated about the disposition of the corpus. 3. In 1952, the settlor died without making any further declaration. He was survived by his only son, L.V. Apte. He was at that time also a trustee. His children, i.e., the settlor's grandsons, who were entitled to the life interest, had by a deed poll dated 29-3-1968, surrendered and released their respective life interest in the remainder of the income of the trust properties. Thus, on 29-3-1968, the trust had no beneficiaries. So, on that date, the trustees conveyed the trust properties to the persons who would be entitled to the properties of the settlor on his death, i.e., conveyance was made to L.V. Apte, his son. 4. We are concerned with the wealth-tax assessments in respect of the trust property for the assessment years 1961-62 to 1967-68. Since the settlor died in 1952 without making any provision for the disposal of the corpus of the trust property, under section 83 of the Indian Trusts Act, 1882, the trustees will be holding the corpus of the trust for the benefit of the legal heirs of the settlor. Since the settlor died before the coming into effect of the Hind....
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....e absence of any provision for charging and assessing the net wealth of a deceased individual beyond the financial year in which the person dies, no assessment could be made. Similarly, in the absence of any specific provision in respect of a dissolved trust, no assessment could be made after its dissolution. He drew a distinction in this matter between section 161 of the Income-tax Act, 1961 ('the 1961 Act') and section 21(1) of the Act. He pointed out that whereas section 161 has provided for a receipt to be assessed in the name of the trustee himself in respect of the income, there is no such provision in section 21. Regarding the second submission he pointed out that section 21(1) has no application for reversionary interest because such an interest must be held by the trustee appointed under a trust declared by a duly executed instrument. In the case before us, he pointed out that there was no such trust under which the HUF had been indicated as the beneficiary. The HUF is the beneficiary only because of the provision of law. The trustees were, therefore, only constructive trustees. The provisions of section 20 of the Act would not apply to such constructive trusts. 9. We are....
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....that in Webster's Dictionary 'belong to' is explained as meaning, inter alia, 'to be owned by', 'be the possession of'. Therefore, the Supreme Court had equated the words 'belong to' to mean not merely full ownership but also interest of lesser degree than full ownership. From this it follows that the trust properties belong to the trustees and the provisions of section 3 would be applicable. 10. We may also refer to the decision of the Supreme Court in the case of CWT v. Kripashankar Dayashanker Worah [1971] 81 ITR 763. In that case, an argument was taken up before the Supreme Court that no assessment could be made on a trust because section 21 referred to properties held by the trust on behalf of the beneficiaries, whereas, in law the properties are held by the trust and the condition is that the properties are held for the benefit of the beneficiaries. The Supreme Court pointed out that the conception in the Act that the trustee is holding the trust property on behalf of others may not be in conformity with the legal position as contemplated by the Indian Trusts Act but the Legislature is competent in the absence of any restrictions placed on it by the Constitution to give its ....
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....executor does not, while the administration is still incomplete, hold the estate or receive its income on behalf of any one else, but does so on behalf of himself as the person in whom the estate lies vested at the time. Even if the executor and trustee be the same person, he does not assume the latter character till the administration has been completed and the residuary legacy ascertained and assented to. Till then, the High Court pointed out, he is liable to be assessed not in a representative capacity but under the general provisions as the owner of the income. Clearly, the position of the executor and the position of the trustee, as far as the vesting of the properties is concerned, are the same. A trustee would also be assessable directly under the general provisions of the Act. 13. The other decision we will refer to is the decision of the Supreme Court in the case of Administrator-General of West Bengal for the Estate of Raja P.N. Tagore v. CIT [1965] 56 ITR 34. The Supreme Court was considering the case of an administrator for the purpose of income-tax assessment. It was pointed out therein that so long as the administration of an estate was not completed, the Administrat....
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....Act. That contention was rejected by this Court. No contention was raised in that case that trustees did not come within the scope of section 3 of the Act. The judgment in that case proceeded on the basis that trustees can be assessed to wealth-tax in respect of the trust property of which they are trustees. There is also no dispute that section 5(1)(i) of the Act proceeds on the basis that a trust property comes within the scope of the Act. Section 3 of the Act does bring within its scope an individual which expression in view of the Central General Clauses Act includes individuals as well, unless the context otherwise indicates. In this case, the context, far from not indicating that the individual does not include individuals, clearly shows at any rate so far the trustees are concerned that it includes individuals. As the Indian Income-tax Act provides for the assessment of 'an association of persons', the context therein may indicate that individual does not include individuals. But such an interpretation is not permissible when we deal with section 3 of the Act. " [Emphasis supplied] It would appear from a reading of the decision that the question not considered in the case of....