Commissioner of Income-tax Vs. Smt. Ram Kaur. - Court Judgment

Excerpt:
head note: income tax clubbing of income under s. 64(1)(iv)--income of spouse--gift out of huf funds--cross gifts--provisions of s. 64(1) not applicable. held : the karta of an huf had power to give gifts within reasonable limits out of love and affection. the gifts made by the assessee out of huf funds to his daughters-in-law being reasonable were valid. moreover, the wife of the assessee having full control over the gifts made to her, provisions of s. 64(1) were not attracted. the income of the wife cannot be clubbed with the income of the assessee. -cit v. daljit singh 1981 131 itr 719 (p & h) followed. income tax act 1961 s.64(1) - s. s. sodhi j. - the three questions which have been referred for the opinion of this court are as under :'(1) whether, on the facts and in the circumstances of the case, the tribunal was right in law in holding that the gifts made out of the hindu undivided family funds by the karta to his daughters-in-law were valid gifts ?(2) whether, on the facts and in the circumstances of the case, the gifts made by the assessee to his daughters-in-law and the sons making gifts to their mother attract the provisions of section 64(1) of the income-tax act, 1961 ?(3) whether, on the facts and in the circumstances of the case, the tribunal was justified in holding that the gifts made in the above manner were not cross-gifts ?'the facts here identical to those in a similar matter which came up before this court in cit v. daljit singh , the only difference being in the name of the donee and donor and the dates and the amounts of the gifts. this being so, this reference too is to be answered in the same manner, i.e., question nos. 1 and 3 are answered in the affirmative, in favour of the assessee and against the revenue while question no. 2 is answered in the negative, again in favour of the assessee and against the revenue. this reference is disposed of accordingly. there will, however, be no order as to costs.