Divan, J.
1. Both these reference arise in connection with the assessments under the Wealth-tax Act of three different members of the same family and in the case of each of the three assessees, the question has arisen under a separate trust deed created by the settlor in favour of the assessee concerned. Each of the three trust deeds in identical terms except that in the case of the assessee in Wealth-tax Reference No. 5 of 1965, there is only one clause different from the two trust deeds in the case of the assessee in Wealth-tax Reference No. 3 of 1965. Since the questions arising in the two reference re common and since the clauses of the trust deed which require interpretation a common, except for the one variation, we will dispose of both the reference by this common judgment.
2. The facts giving rise to this reference are that by three different trust deeds, all included of February 28, 1958, the settlor, who was under an obligation to provide for the expresses and of and incidental to the marriage of his two brothers and his sister, settled certain jewellery mentioned in the schedule to each of the three trust decides on trust for the purposes set out in the three trust deeds; and the jewellery was settled upon trust with a view to make due provision for the expenses of and incidental to the marriage of the two brothers and the sister of the settler. In the case of Sangramsinh, the brother, the jewellery settled upon trust was worth Reference No. 3/1965, the jewellery was worth Rs. 6,93,250; and in the case of the sister, who is the assessee in Wealth-tax Reference No. 5 of 1965, the jewellery was worth Rs. 6,99,790. So far as Sangramsinh was concerned, there were two trustees, viz., the settlor and the mother of the settlor and in the case of Ranjitsinh and Lalita Raje, the sister, the trustees were the settlor, the mother of the settlor and one Jaysinhrao Mansinhrao Ghorpade. There was no dispute regarding the validity and the genuineness of the trust deeds and regarding the amounts of the value of the jewellery mentioned in each of the three deeds. The values of the jewellery were shown by each of the three assesses as forming part of his or her net wealth as on the valuation date, March 31, 1957; and each of the three assesses was according the amounts of the value of the jewellery mentioned in each of the three deeds. The values of the jewellery were shown by each of the three assesses as forming part of his or her net wealth as on the valuation date, March 31, 1957; and each of the three assessees was accordingly assessed to wealth-tax for the assessment year 1957-58. So far as the assessment year 1958-59 was concerned, each of the assessees first filed his or her Wealth-tax return showing the value of the said jewellery as forming part of his or her wealth on the relevant valuation date but later on filed a revised return excluding the value of the jewellery mentioned in the respective trust deed. The trustees filed separate returns for all the assessment years under consideration showing the value of the jewellery as forming part of their wealth on the relevant valuation dated.
3. Before the Wealth-tax Officer, the assessees contended that, since the jewellery settled in trust was to be handed over by the trustees to the assessee's wife, so far as the two brothers were concerned, if there was any surplus left after meeting the expenses of the marriage, the value of the jewellery should not be included in the net wealth of the assessee for the assessment years under consideration. It was also submitted that the trustees had also filed their wealth-tax return showing the value of the jewellery as their net wealth and, therefore, the trustees can be assessed to wealth-tax in respect of the value of the jewellery settled upon trust so far as the two brothers were concerned. In view of the different provisions in the trust deed concerning the sister, Lalita Raje, this contention could not be advanced in her case. On construction of the different clauses of the different trust deeds, the Wealth-tax Officer came to the conclusion that each of the assess had a beneficial interest in the trust property and exercising the option under section 21(2) of the Wealth-tax Act, the Wealth-tax Officer included the value of the jewellery settled upon trust in the net wealth of the assessee concerned. The matters were taken in appeal to the Appellate Assistant commissioner and the contentions which were urged before the Wealth-tax Officer were repeated before the Appellate Assistant commissioner. The Appellate Assistant commissioner held that each of the assessees had a beneficial interest in the trust fund and as the trustees were at liberty to utilize the whole or any part of the corpus on the occasion of the marriage of the assessee, they had a wide discretion in this regard and the amount remaining after meeting the marriage expenses had to go to the wives of the assessees, so far as the two brothers were concerned; and the Appellate Assistant Commissioner held that the assessees' beneficial interest in the trust was indeterminate and unknown. In the case of the sister, Lalita Raje, the Appellate Assistant Commissioner was of the view that the assets were held by the trustees for the benefit of the assessee as the balance of the corpus which might be unexpended was to be handed over to the assessee and, therefore, he came to the conclusion that the assets were held by the trustees for the benefit of the assessee; and her share was neither indeterminate nor unknown and the entire value was includible in the net wealth of the particular assessee. As regards the two brothers, the Appellate Assistant Commissioner took the view that the proper course in their case was to apply the provisions of section 21(4) and levy wealth-tax upon the trustees and recover the same from the trustees as if the persons on whose behalf the assets were held were individuals for the purposes of the Act. Under these circumstances, the Appellate Assistant commissioner deleted the value of the jewellery from the total wealth of the two assessees, i.e., the two brothers; but included it in the total wealth of the sister, Lalita Raje.
4. The matters were then taken in appeal to the Tribunal and the Tribunal held that an absolute interest was created under the trust deed in favour of each of the assessees concerned on the execution of the relevant trust deed. The Tribunal also came to the conclusion that the assessee was not a minor at the date of the execution of the trust deed and the Tribunal held that the direction regarding accumulation of income till the marriage of the assessee was not binding. The Tribunal, therefore, held that the value of the jewellery should be included in the net wealth of the assessee under section 21(2) of the Wealth-tax Act and the same orders were passed in all Sangramsinh and Ranjitsinh, the brothers of the settlor, the following two questions have been referred to this court by the Tribunal :
'(1) Whether, on the fats and in the circumstances of the case did the assessee have any such interest on the valuation dates relevant to the assessment year 1958-59 to 1961-62 under the trust deed dated February 28, 1958, created by H. H. the Maharaja Fatehsinh Gaekwad of Baroda, which was includible in the net wealth of the assessee
(2) If the answer to question No. (1) is in the affirmative, then whether, on the facts an in the circumstance so the case, was the Tribunal justified in valuing the assessee's interest on the relevant valuation dates in the trust created by H. H. the Maharaj Fatehsinh Gaekwad by deed, dated February 28, 1958, at the total value of the trust corpus on the relevant valuation dated ?'
5. The same two questions have also been referred at the instance of the assessee so far as the wealth-tax assessment regarding the sister, Lalita Raje, was concerned.
6. It is necessary to set out the material clause so the trust deed. As we have already pointed out above, barring one clause, viz, clause 3(e), the provisions of all the three trust deeds executed on February 28, 1958, trust decide, it has been mentioned that the settlor was the ruler of Baroda State and as such was under an obligation to prove idea for expenses of and incidental to the marriage of his brother, Prince Sangramsinh, and in each trust deed the name differs in this recital clause : and in the recital it has been further mentioned that it was with a view to make due provision for the expenses of and incidental to the marriage of the assessee in question that the settlor had set apart the jewellery described in the schedule to each of the three trust deeds; and it was further mentioned in this recital clause that the said jewellery had been handed over to the trustees prior to the execution of the trust deeds and that the trustees were to hold them upon trusts mentioned in the deed of trust. Under clause 2 of the deed of trust, the trustees ar to hold and stand possessed of the jewellary are referred to as the trust fund. Under clause 4 of the trust deed, in each of the three cases, the trustees have been given the power to keep the trust fund in the shape of jewellery for such time or times however long as they may in their absolute discretion think fit without being answerable or accountable to the beneficiaries or any other party for any loss caused thereby and in their absolute discretion to sell, assign, transfer or realise the same or any part thereof and to invest the sale proceeds or other realisations or any other moneys requiring investment in the trust deed. The material clause for the purposes of this judgment is clause 3 of the trust deed and is as follows :
'3. The trustees shall hold and stand possessed of the trust fund upon trust :
(a) To allow the trust fund or any part thereof to remain in its present state of investment or to sell the same and realise the sale proceeds and invest the same as hereinafter mentioned and to recover the interest, dividends and income of the trust fund and to pay out of the same the charges for collection and all other outgoing, if any.
(b) For a period of ten years from the date of these presents or until the marriage of the settlor's brother the said Prince Sangramsinh whichever event shall happen first to accumulate the interest, dividends and income of the trust fund and to add the same to the corpus of the trust fund.
(c) If at the expiration of the said period of ten years the settlor's brother the said Sangramsinh shall not have married to pay the whole of the interest, dividends and income of the accumulate trust fund to the settlor's brother the said Sangramsing until the death or marriage or until he attains the age of fifty years whichever event shall happen first.
(d) On the occasion of the marriage of the settlor's brother the said Prince Sangramsinh the expend or utilise the corpus of the trust fund on behalf of or for the benefit of the said Price Sangramsinh for the purpose of the marriage AND IT IS HEREBY PROVIDED THAT it shall be lawful for the trustees to pay or utilise the whole or any part of the corpus of the trust fund in advance of such marriage for enabling the expenses in respect of such marriage being defrayed thereat and for making gifts and presents to the bride and members of the family according to the custom of the family of the settlor PROVIDED FURTHER that the trustees shall be at liberty in their absolute discretion to pay to the said Prince Sangramsinh the whole or any part of the corpus of the trust fund for such purposes and in any such event the trustees shall not be liable to see to the application of be responsible for the non-application or mis-application thereof AND IT IS HEREBY AGREED AND DECLARED that notwithstanding anything herein or in general law contained to the contrary any at bona fide done by the trustees or any payment bon fide made or expenses bon fide incurred by the trustees in pursuance of the provisions of this clause shall not be questioned in any court of law or otherwise howsoever by any person whomsoever.
(e) If any amount of the same corpus remains unexpend, the same shall be handed over to such wife absolutely.
(f) If the said Prince Sangramsinh shall not have married up to the age of 50 years, then on his attaining the age of fifty years, the corpus of the trust fund shall be handed over to the said Prince Sangramsinh absolutely.
(g) In the event of the death of the said Prince Sangramsinh before marriage and before attaining the age of fifty years, then on his death, the corpus of the trust fund shall be divided amongst the heirs of the said Prince Sangramsinh according to the law of intestated succession amongst the Hindus.'
7. The difference between the trust deed executed in favour of the sister, Princess Lalita Raje, is that in her case clause 3(e) is in these terms :
'If any amount of the corpus remains unexpended, the same shall be paid and handed over to the said Princess Lalita Raje absolutely.'
8. Thus, so far as the two brother, Ranjitsinh and Sangramsinh, are concerned, the provision in clause 3(e) is that in the event of any corpus remaining unexpended in connection with the marriage ceremony of the person concerned, the balance was to be handed over to the wife of Sangramsinh or Ranjitsinh as the case may be; but as regards Princess Lalita Raje, the provision is that the unexpended surplus of the corpus of the trust fund should be handed over to her absolutely by the trustees; provided, of course, that any surplus remains after all the expresses in connection with and incidental to the marriage have been met.
9. It is clear that under clause 3(a), the trustees have been given the power to allow the trust fund or any part thereof to remain in the same state of investment or to sell the same and invest the sale proceeds in other property and to pay out of the income the charges for the collection and all other outgoings in connection with the trust fund. In clause 3(b), there is a direction for accumulating the income of the trust fund for a period of 10 years from the date of the execution of the trust deed or until the marriage of Sangramisinh, Ranjitsinh or Lalita Raje, as the case may be, and the material words in the clause are : 'Whichever event shall happen first'. Under clause 3(b), the accumulated in come is to be added to the corpus of the trust fund. The Tribunal came to the conclusion that section 1 of the Transfer of Property Act applied to clause 3(b). Under section 11 of the Transfer of Property Act, where on a transfer of property an interest therein is rested absolutely in favour of any person but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of any such interest as if there was no such direction. Under section 17 of the Transfer of Property Act, where the terms of a transfer of property defeat that the income arising from the property shall be accumulated either wholly or in part during a period longer than the life the transferor, or a period of eighteen years from the date of the transfer, such direction shall, save as provided in the Transfer of Property Act, be void to the extent to which the period during which the accumulation is directed exceeds the longer of the aforesaid periods and at the end of such last-mentioned period the property and the income thereof shall be disposed of as if the period during which the accumulation has been directed to the made had elapsed. In the instant case, the period during which the income from the trust fund is to be accumulated is a period of 10 years, i.e., less than the statutory period mentioned in section 17(b) of the Transfer of Property Act; and, therefore, the direction contained in clause 3(b) is a valid direction in the eye of the law; and as regards the interpretation of clause 3(b), we are unable to agree in this connection that the provisions of section 11 have any application to the interpretation of clause 3(b). It is clear that this clause is valid under section 17(1) of the Transfer of Property Act and in arriving at our conclusion in this case, it is not possible for us to base our diocesan purely on the interpretation of clause 3(b).
10. Clause 3(c) in each of the three cases provides that after the expiration of the period of 10 year during which the income is to be accumulated and added to the corpus, the settlor's brother or sister, as the case might be, shall not have married then the whole of the interest, dividends and income of the acccumulated trust fund have to be hand over to the brother or the sister, as the case might be, until the death of the brother or sister or marriage or until the brother or the sister attaining the age of 50 years, whichever out of the three events, viz., death, marriage or attaining of the age of 50 years, shall happen first. It is again clear that clause 3(c) purports to dispose of the net income of the trust fund after the expiry of ten years from the date of the execution of the trust deed. It is this clause 3(c) which has some bearing on the interpretation of the rest of the clauses. It is co-related to the later clauses 3(d), 3(e) and 3(f) of the trust deed.
11. Under clause 3(d) of the trust deed, directions have been given to the trustees to spend the whole or such part as they think proper on behalf of and for the benefit of the brother or the sister in question and power has been conferred upon the trustees to pay or utilize the whole or any part of the trust fund even in advance for the marriage for meeting the expenses in connection with the marriage being defrayed from it and for making gifts and presents to the bride and to the members of the family according to the custom of the family of the settlor. Clause 3(d) also on furs powers on the trustees to hand over the entire amount of the trust fund to the brother or the sister concerned but that must be done for such purposes, i.e., for purposes of and incidental to the marriage of the person concerned; under this sub-clause immunity had been conferred upon the trustees by stating that they are not liable for any account in respect of the expenses for marriage including feasts and presents incurred by the trustees and they are also not to be held liable for seeing that the amounts so handed over to the brother or the sister concerned is or is not applied to the purposes of and incidental to the marriage of the person concerned; nor are the trustees to be responsible for the non-applicability or the mis-application of the trust fund; and the action of the trustees in pursuance of clause 3(d) is not to be questioned fin any court of law or otherwise howsoever by any person whomsoever.
12. Under clause 3(e) provision is made as to what should be done in the of and incidental to the marriage have been met and in the case of the two brothers, the wife of the brother concerned is to get absolutely the unexpended balance of the corpus of the trust and such surplus is to be ascertained after the trustees have, in their discretion, spent the said amount as they thing proper in connection the marriages of the two brothers. In the case of the sister, Lalita Raje, clause 3(e) specifically provide that the unexpended surplus is to belong absolutely to her and is to be handed over to her.
13. Reading clauses 3(d) and 3(e) together, therefore, it is obvious that the trustees have been placed founder and obligation to spend such amount as they like out of the trust fund corpus on behalf of and for the benefit of the two brothers and the sister; but the expenditure must be for the purpose of the marriage and not for any other purpose and out of the trust fund in question, the trustees are to defray the expenses in connection with the marriage and also for making gifts and presents to the bride and members of the family according to the custom of the family of the settlor. Under clause 3(e), therefore, in each of the three cases, it is only such balance as may remain over after the trustees in their absolute discretion have defrayed the expenses of the marriage of the assessee concerned, that in the case of the two brothers the wife is to get the unexpended surplus and in the case of the sister, she herself is to get such surplus absolutely.
14. Under clause 3(f), provision has been made that if either of the two brothers or the sister remains unmarried up to the age of 50 years, on attaining the age of 50 years, the corpus of the trust fund is to be handed over to the assessee concerned. Thus, it is clear that the handing over of the entire corpus to either of the two brothers or the sister is to occur if the assessee concerned is not married till the age of 50 years. Clause 3(c), which deals with the disposal of the income of the trust fund after the period of expiry of 10 years for the date of the deed of trust, it to cease to have operation on the assessee concerned remaining unmarried up to the age of 50 years. Thus, for the first 10 years the income is to be accumulate and added to the corpus. At the end of 10 years, the income from the trust fund is to be paid to the assessee concerned till the happening of any one of the three events, viz., the assessee attaining the age of 50 years, the assessee getting married or the assessee dying before marriage or before attaining the age of 50 years. On the happening of any of these three events, the payment of the income if to stop and the entire income is to be utilized by the trustees as directed in clauses 3(d) and 3(e); but if there is no marriage before 50 years, then under clause 3(f), the entire corpus of the trust fund is to be handed over to the brother or the sister concerned absolutely. Clause 3(g) provides for a situation which may arise when the brother or the sister concerned dies before attaining the age of 50 years but without getting married and in the case of death thus happening, the entire corpus of the trust fund is to be divided amongst the heirs of the brother of the sister concerned, the heirs being determined wording to the law of interestate succession applicable to Hindus. It is, therefore, clear that both clauses 3(f) and 3(g) provide for the assessee concerned remaining unmarried and neither attaining the age of 50 years without getting married, the corpus is to be handed over to the assessee himself, in the event of the assessee concerned dying before attaining the age of 50 years but without getting married, the corpus of the trust fund is to go to the heirs of the assessee concerned, the heirs being determined in accordance with the law of intestate secession applicable amongst the Hindus.
15. We may also point out that under clause 11 of each of the three trust deeds, the trust deed is to remain irrevocable up to 12 noon of March 15, 1964, and after the expiration of that period of irrevocability, it is open to the settlor at any time or times in his absolute discretion to revoke all or any of the uses, trusts, powers, provisions and limitation set out in the earlier clauses of the trust deed. After the power of revocation is exercised by the settlor under clause 11, the trust fund or any part thereof in respect of such power of revocation is exercised is to belong absolutely to the settlor.
* * * * 'As regards clauses 3(c) and 3(d) read with clauses 3(e), (f) and (g) of the trust deed, it is clear that those clauses provide for the disposal of the corpus of the property; but each sub-clause provides for a different eventuality. It was contended on behalf of the revenue before us by the learned Advocate-General that the real scheme of the trust did is to give the entire corpus to the person concerned on the attainment of 50 years of on death; the benefit of the corpus going to the heirs in the event of the death and if the person concerned gets married before attaining the age of 50 years, then Clauses 3(d) and (e) come into operation and not otherwise. It was, therefore, contended before us on behalf of the revenue, that there was an absolute vesting of the property in the person concerned under clauses 3(f) and (g) subject to the possibility of defeasance in the even of the marriage taking place before the attainment of 50 years. In our opinion, it is obvious that clauses 3(f) and (g) both provide for vesting of the property but the main question is whether there is absolute vesting of the property in the assessee concerned subject to a possibility of defeasance or whether there is a contingency contemplated by clauses 3(f) and (g), the contingency being not getting married before attaining the age of 50 years or before death.
16. Under section 21 of the Transfer of Property Act, it has been provided :
'Where on a transfer of property, an interest therein is rested in favour of a person to take effect only on the happening of a specified uncertain event, or if a specified uncertain event shall not happen, such person thereby acquires a contingent interest in the property. Such interest becomes a vested interest, in the former case, on the happening of the event, the latter, when the happening of the event becomes impossible.
Exception. - Where, under a transfer of property, a person becomes entitled to an interest therein upon attaining a particular age, and the transferor also gives to him absolutely the income to arise from such interest before the reaches that age, or directs the income or so much thereof as may be necessary to be applied for his benefit, such interest is not contingent.
It may be pointed out that no reliance was placed on behalf of the revenue on this Exception to section 21. It is clear from the wording of the Exception that the Exception applies only to a case where the interest in the fund is given to any person on his attaining a particular age. It the vesting his to take effect on the happening of any other contingency (in the instant case, it is not only attaining the age of 50 years but also remaining unmarried till that age), the Exception cannot apply, in spite of the fact that till the vesting is to take place on attaining the age of 50 years the income from the expiry of the period of 10 years, till the attaining of the age of 50 years or marriage or death, is to be handed over to the assessee concerned. In view of the fact that no reliance has been placed on the provisions of the Exception to section 21 of the Transfer of Property Act, it is not necessary for us to go into the decision in Sopher's case; nor is it necessary for us to consider whether the decision in Sopher's case applies to a trust deed as distinguished from a will.
What has come to be known in English law as the rule in Phipps v. Akers and which is also commonly known as the rule in Edwards v. Hammond is stated as follows : 'If real estate be devised to A, 'if' or 'when' he shall attain a given age, with a limitation over in the event of his dying under that age, the attainment of the given age is held to be a condition subsequent and not precedent, and A takes an immediate vested estate, subject to be divested upon his death under the specified age. And if the device be to A, if or when he shall attain a given age, with a limitation over upon his death under that age without issue, A takes a vested estate, defeasible only in the event of his death without issue under the specified age.'
17. In Commissioner of Income-tax v. Bhogilal Maganlal Shah, the rule in Phipps v. Ackers was considered by us and we held in that case that, so far as the first rule in the said case is concerned, it has been adopted in India by the Exception to section 21 of the Transfer of Property Act and the Exception of section 120 of the Indian Succession Act. We have already pointed out in the course of this judgment that in this particular case, the Exception to section 21 of the Transfer of Property Act does not apply; and we further held in Bhogilal Maganlal Shah's case that the second rule was not adopted by the Legislature in India; and we also held that the applicability of the second rule in Phipps v. Ackers cannot be imported in the construction of settlements or wills in India; and we there held that the revenue could not rely upon the second rule of construction for the purpose of converting what was to all intent and purposes a contingent interest into a vested interest. Therefore, we have to interpret clauses 3(f) and 3(g), in the light of what has been stated in those two clauses without recourse to the second rule in Phipps v. Ackers.
18. It is true, as was urged by the learned Advocate-General on behalf of the revenue, that the court has to approach the task of construction in such cases with a bias in favour of vested interest unless the intention to the contrary is definite and clear. In view of the decision in Rajes Kanta Roy v. Smt. Shanti Devi, it is clear that there can be no doubt that the question is really one of intention to be gathered from a comprehensive construction has to be approached with a bias in favour of vesting unless the intention against vesting is definite and clear. We have, therefore, to ascertain the intention upon reading all the relevant clauses in the trust deed and find out whether there is a clear and definite intention that the interest of the assessee concerned in the relevant trust deed should be a contingent interest or whether the bias in favour of vesting should operate in each of these three cases.
19. When one turns to clauses 3(f) and (g), it is clear that in each of these two clauses what is dominant in the mind of the settolr, and bearing in mind also the object of the settlor in creating this trust, is that first and foremost the deed of trust has been created in order to provide for expenses of and incidental to the marriage of the assessee concerned. But provision has also to be made for certain eventualities which may or may not happen, viz., the assessee not getting married at all till reaching the age of 50 years or the assessee dying before getting married and it is to provide for these eventualities that the provision has been made in clauses 3(f) and 3(g). It is clear that the event of the assessee remaining unmarried up to the age of 50 years is an uncertain event; and similarly the event of the assessee dying before marriage and before attaining the age of 50 years is also an uncertain event. Though the death of a person is a certainty and it he does not die before reaching the age of 50 years, his attaining the age of 50 years is also a definite and certain event, what is not certain is his remaining unmarried by the time he attains the age of 50 years. Therefore, it is clear that the eventuality of remaining unmarried up to the age of 50 years or of dying before attaining the age of 50 years and before marriage being uncertain events, clauses 3(f) and 3(g) create a contingent interest in the assessee. The trust deed having been created in discharge of the obligation of the settlor to provide for the expenses of and incidental to the marriage of the assessee concerned, the primary object is what has been set out in cluases 3(c) and 3(d), viz., provision for the marriage expenses and it is with that end in view that clauses 3(c) which deals with the income of the trust fund provides that on any one of the three events happening, viz., marriage or death or attaining the age of 50 years of age without getting married and under clauses 3(g) in the event of death before attaining the age of 50 years and before getting married. It is true that the order in which the different clauses in the trust deed are set out should not with us in interpreting the provisions of the trust deed; but in order to find out whether the trust complete analysis of the different sub-clauses of clause 3, that the events on the happening of which clauses 3(f) and 3(g) are to come into operation are not certain events, that it, are not events which are bound to happen and, therefore, the interest created under clauses 3(f) and (g) can only be a contingent interest and not a vested interest.
20. Though no such vested interest can be said to have been created under clauses 3(f) and 3(g), at the same time we must take note of the fact that under clause 3(d), provision has been made by the settlor for the disposal of the corpus of the entire trust fund and the trustees have been empowered to utilize the whole or such part of the corpus as they in their absolute discretion think fit for defraying the expenses of and incidental to the marriage of the assessee concerned. There is no direction given to the trustees as to what proportion of the entire corpus they should utilize for the purpose of and incidental to the marriage; and the discretion of the trustees in that behalf is absolute and unfettered. Even though the trustees have been empowered to pay to the assessee concerned the whole or any part of the corpus of the trust fund for the purpose of defraying the marriage expenses, such handing over of the part of the corpus is limited by the purpose for which the trustees can so hand it over, viz., for the purpose of the marriage and, therefore, this power set out in clause 3(d) enabling the trustees to pay to the assessee concerned the whole or any part of the corpus cannot be interpreted as anything else but a provision for defraying the expenses of and incidental to marriage of the assessee concerned. In our opinion, since it has been left to the discretion of the trustees under clause 3(d) as to how much out of the corpus they should spend for the marriage, it cannot be said that a definite portion or the whole of the trust fund has been set apart for the marriage expenses of the assessee concerned. Since clause 3(d) provides for the celebrating of the marriage of the assessee concerned in accordance with the custom of the family of the settlor and for making gifts and presents to the bride and members of the family in the case of the two brothers and the husband of the sister and members of the family, in the case of Princess Lalita Raje, it is obvious that the entire provision of clause 3(d) is for the benefit of the assessee concerned and a vested interest is created in favour of the assessee concerned under clause 3(d); the vested interest being to see that his/her marriage is celebrated in accordance with the family custom and in the proper manner, of course, the amount to be spent being left to the absolute the marriage expenses of the person concerned should not be treated as a provision for his benefit. The provision for marriage expenses in these three cases, in our opinion, stands on the same footing as a provision in a deed of settlement or a will or the reduction of a particular person named in the document or for his advancement in life or for similar other purposes. It is, therefore, clear, in our opinion, that a vested interest in each of the three assessees is reacted under clause 3(d), he/she being entitled to have his/her marriage performed out of the corpus of the trust fund.
21. However, in the case of the two brothers, Sangramsinh and Ranjitsinh, the balance that may remain out of the corpus for meeting the marriage expenses under clause 3(d) is to be handed over to the wife of the assessee concerned. Therefore, so far as these two assessees are concerned, their interest in this particular property under clause 3(d) can only be described as indeterminate. how much is to be spent out of the trust fund depends upon the discretion of the trustees and it is not open to the assessee to insist that a particular portion out of this property shall be spent in connection with his/her marriage. The case would, therefore, clearly fall under section 21(4) of the Wealth-tax Act since the share of the assessee on whose behalf or for whose benefit the corpus fund is held is indeterminate and the wealth-tax can be levied upon the trustees of the particular deed of settlement, so far as the two brothers at least are concerned. Though each of the assessees under clause 3(d) had a vested interest in the property, it an not be said as to how much portion, whether whole or part, is being held by trustees on behalf of or for the benefit of the particular assessee. Under these circumstances, section 21(2) of the Wealth-tax Act cannot come into operation and, in our opinion, the Tribunal was in error when it held that the provision of section 21(2) can be invoked in the case of the two brothers.
22. This conclusion of ours regarding the two brothers in based on the fact that under clause 3(e), the unexpended surplus remaining after meeting the marriage expenses is to belong absolutely to the wife of the assessee concerned and hence the interest in the corpus under section 3(d) is indeterminate and giving over is in favour of the wife, who is not immediately the beneficiary under the trust deed but has only a contingent interest, the contingency in her case being, firstly, marriage taking place and, secondly, any surplus remaining at all.
23. So far as Princess Lalita Raje is concerned, in her case, the trust deed in cluase 3(e) provides that the unexpended surplus of the corpus remaining after meeting the marriage expenses is to belong to her absolutely and, therefore, under clauses 3(d) and (e) read together, the interest of Lalita Raje overs the entire corpus of the trust found. It is, therefore, the interest of Lalita Raje covers the entire corpus of the trust fund. It is, therefore, clear that, in her case, section 21(2) can be validly invoked; and her interest in the property is includible in her net wealth for the relevant assessment year.
24. Even though we have come to this conclusion regarding Princess Lalita Raje, the assessee in Wealth-tax Reference No. 5 of 1965, we must point out that the valuation of her interest will have to be done under the provisions of section 7 of the Wealth-tax Act. Simply because it is held by us that Lalita Raje has a vested interest in the trust fund under this particular trust deed, it does not necessarily follow that the entire corpus of the trust fund automatically becomes includible in her total wealth for the relevant assessment year. The value of treat interest shall have to be estimated by the authority concerned in the light of the provisions of section 7 of the Wealth-tax Act.
25. We, therefore, answer the questions as follows :
Wealth-tax Reference No. 3 of 1965.Q. No. Answer.1. In the negative.2. Does not arise.The Commissioner will pay the costs of this reference tothe assessee.Wealth-law Reference No. 5 of 1965.1. In the affirmative.2. In the negative; but the valuation is to be arrivedout under section 7 of the Wealth-tax Act.The assessee will pay the costs of this reference to the Commissioner.(7th October, 1968)
26. After the above judgment was delivered by us in open court but before it was signed by us, Mr. Kaji, on behalf of the assessees, drew out attention to a judgment of the Supreme Court in Commissioner of Wealth-tax v. Smt. Muthukrishna Ammal, in Civil Appeal No. 1922 of 1967, delivered by the Supreme Court on September 6, 1968, and asked us to reconsider our decision in the light of this judgment of the Supreme Court.
27. As we have indicated in our judgment, Mr. Kaji had relied upon section 2(e)(v) of the Act and also the decision of the Madras High Court in Commissioner of Wealth-tax v. Srimathi Martinammal Machado, and it is in the context of section 2(e)(v) that this latest decision of the Supreme Court requires consideration.
28. In the case before the Supreme Court, the respondent, Smt. Muthukrishna Ammal, had obtained from the Government of India on lease certain salt-pans by two agreements, dated January 1, 1943, and January 1, 1945, respectively. Each lease was to endure for 25 years unless otherwise determined under the covenants of the relevant indenture. The respondent sub-let the right under the first lease to one K. Nadar in consideration of an annual payment of Rs. 15,000 and she sub-let the right under the second lease to Mettur Chemicals Ltd. in consideration of an annual payment of Rs. 18,000. In the course of wealth-tax proceedings regarding the respondent, the question arose as to whether the leasehold interest in the salt-pans should or should not be included in her wealth. The Wealthy-tax Officer brought to tax the value of the salt-pans as part of the assets held by the assessee. This order was conferred by the Appellate Assistant Commissioner but the Income-tax appellate Tribunal held that the interest in the salt-pans was not an asset within the meaning of section 2(e)(v) as her interest was not available to her for a period exceeding six years. On a referene to the High Court of Madras, the High Court held that the leasehold interest in the salt-pans was not an asset within the meaning of section 2(e)(v) and that its value was not liable to be included in her net wealthy. Thereafter, the Commissioner of Wealth-tax appealed to the Supreme Court.
29. The covenants of the two leases were in identical terms. Clause 1 of the covenant in the lease provided as follows :
'1. The lease shall be for a period of twenty-five years commencing from the 1st to January, one thousand nine hundred and forty-three provided that the lessor or assessee shall be at liberty to determine the lease on giving to the owner of them notice in writing at the clause of the salt manufacturing season.'
30. Particularly, in view of this clause it was held that each lease was liable to be determined by a notice by either side at the close of the salt manufacturing season; and the Supreme Court held that the interest of the assessee under each lease was precarious, it was liable to be determined by notice by the other party at the expiry of the salt manufacturing season; and Shah J., delivering the judgment of the Supreme Court, observed :
'The leasehold interest in the salt-pans ways, therefore, not available to the assessee for a period exceeding six years from the valuation date. A lessee's interest in land ins undoubtedly an interest in immovable property and would normally be an asset, unless within the meaning of cession 2(e) (v) of the Act, the interest in the property is available to the assessee for a period not exceeding six years.'
31. The Supreme Court interpreted the words, 'is available to an assessee for period not exceeding six years', occurring in section 2(e)(v), to mean that, though the assessee has an interest in property at the valuation date, the interest will remain available for a period not exceeding six years. If it is to remain available for six years or for a shorter period the interest will fall within the exception; if it is to remain available for a period exceeding six years, it will fall within the definition of 'assets' and its value will be liable to be included in the net wealth of the assessee. It was contended before the Supreme Court on behalf of the revenue that Parliament had amended section 2(e)(v) of the Act by the Wealth-tax (Amendment) Act, 1964; and the words, 'from the date the interest vests in the assessee', added at the end of section 2(e)(v), were an instance of parliamentary exposition of the meaning of the clause as it stood prior to the amendment. The Supreme Court repelled that argument and in the end observed :
'We are of the view that interest in property which is available to the taxpayer for a period not exceeding six years from the valuation date is not an asset within the meaning of section 2(e) land the value thereof cannot be included in the net wealth of the assessee for the financial year relevant to the valuation date.'
32. In the instant case, the three relevant trust deeds were all executed on February 28, 1958, and by clause 11 of each of the three trust deed it has been provided that the trust deed shall remain irrevocable up to 12 noon of March 15, 1964. After the expiration of this period, it would be lawful for the settlor at any time or times by any deed or deeds, revocable or irrevocable, inter verves or by his last will or codicil thereto to later, vary or absolutely to revoke all or any of the uses, trusts, powers, provisions and limitations declared in each of the three trust deeds and contained therein concerning the trust fund as provided and appointed therein and if he so desired in lieu of the uses, trusts and limitations so revoked to limit, declare and appoint by the same or any other deed or deeds or will or codicil such new or other uses, trusts, powers, provisions and limitations of and concerning the trust fund or the income thereof or the management thereof as he, the settlor, shall think proper notwithstanding anything thereinbefore contained to the contrary and upon such revocation the said trust fund or any part thereof or the income thereof or any part thereof in respect of which such power to revocation shall be exercised shall belong absolutely to the settlor subject to any such new limitation, declaration or appointment. In view of this power of revocation it is clear that as from 12 noon of March 15, 1964, the interest of each of the assessees under the relevant trust deed was precarious because as from March 15, 1964 it was open to the settlor to revoke the trust completely and thus deprive the beneficiary concerned of the interest in the trust fund, whatever the nature of that interest may be. It is clear in the instant case that the relevant valuations dates are March 31, 1958, March 31, 1959, March 31, 1960, and March 31, 1961, the relevant assessment years being 1958-59, 1959-60, 1960-61, respectively. Thus, it is clear applying the ratio of the Supreme Court decision to the facts of this case, that on each of these four valuation dates, the interest in the trust fund was available to the assessee for a period not exceeding six years from the relevant valuation date and hence was not ask asset within the meaning of section 2(e) of the Act and the value thereof cannot be included in the net wealth of the assessment for the financial year relevant to that valuation date. The earliest of these four valuation dates is March 31, 1958, and since under Clause 11 the power of revocation can be exercised by the settlor any time after 12 noon of March 15, 1964, even from that earliest valuation date, the interest to the beneficiary is not available to him for a period exceeding six years.
33. Under these circumstances, it is clear that in the light of the provisions of section 2(e)(c) as interpreted by the Supreme court in Smt. Muthukrishna Ammal's case, in each of the three cases, the interest of the assessee in the trust fund was not includible in the assets of the assessee concerned.
34. In the light of these conclusions, we answer the questions referred to us as follows :
35. Wealth-tax Reference No. 3 of 1965 :
Q. No. Answer.1. In the negative.2. Does not arise.Wealth-tax Reference No. 5 of 1965 :1. In the negative.2. Does not arise
36. The Commissioner will pay the costs of the assessee in each of the two reference.