Mumbai Court March 1948 Judgments
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The Commissioner of Income-tax Vs. Laxmidas Mulraj Khatau
Court: Mumbai
Decided on: Mar-16-1948
Reported in: (1948)50BOMLR360
M.C. Chagla, C.J.1. The assessees' accounting year is the Hindu year Samvat 1998 which commenced on October 21, 1941, and ended on November 8, 1942. The assessees held some shares in the Khatau Makanji Spinning & Weaving Mills, Ltd., and on October 18, 1941, the company declared a dividend out of the profits of the year ended June 30, 1941. The dividend was made payable on and after November 3, 1941, and it was paid on that day. With regard to the dividends out of the profits of the year ended June 30, 1942, they were declared by the company on October 19, 1942, and the dividend was made payable on and after November 2, 1942, and it was paid on the same day. The Income-tax Officer treated both these dividends as the dividend income of the assessees for the assessment year 1943-44 as both the dates, viz. November 8, 1941, and November 2, 1942, fell in the S.Y. 1998. The assessees' contention was that as far as the dividend for the year ended June 30, 1941, was concerned the dividend sho...
Behramji Sorabji Lalkaka Vs. Commissioner of Income-tax, Bombay.
Court: Mumbai
Decided on: Mar-16-1948
Reported in: [1948]16ITR301(Bom)
CHAGLA C.J. - Two questions have been raised on this reference and they are concerned with certain income arising to Freny, the daughter of the settlers, under the trust deed dated 15th January, 1936. The settlers, who are the assessee and his wife, had three children Freny, Feroza and Phiroz and the trust deed provided that the properties belonging to the settlers which were movables should be divided into three parts, one for each of the three children of the settlors, and the scheme of the trust deed was that during the life time of the settlors the trustee should hold these properties in trust and give the income for the maintenance of the three children of the settlors and the property was to be handed over to these three beneficiaries after the death of the survivor of the settlors. The trust deed made provisions with regard to the death of any of the three beneficiaries before the death of the survivor of the settlors, and clause 4 deals with Phiroz predeceasing the survivor of ...
Prince Khanderao Gaekwar of Baroda Vs. Commissioner of Income-tax, Bom ...
Court: Mumbai
Decided on: Mar-16-1948
Reported in: [1948]16ITR294(Bom)
.CHAGLA, C.J. - The assessees before us are the grandsons of H. H. the Maharaja Sir Sayaji Rao Gaekwad of Baroda. Sir Sayaji Rao created a family trust in April, 1905, and he executed a deed of variation on 13th April, 1928. Under clause 6 of the deed of variation each of his two grandsons, the assessees, gets an eighth share in the income of the trust subject to a condition that if their mother Princess Kamaladevi should live separate from them or either of them then and in such a case the trustees should pay Rs. 9,000 per year if she shall live separate from either of them and the sum of Rs. 18,000 if she shall live separate from both of them, and such sums of Rs. 9,000 or Rs. 18,000 as the case may be shall be deducted by the trustees from and out of the income or incomes of the said assessees, from whom Princess Kamaladevi may live separate. Princess Kamaladevi began to live separately from both the assessees from 1st April, 1941. On 5th November, 1942, both the assessee executed t...
Shree Sakti Mills Ltd. Vs. Commisioner of Income-tax
Court: Mumbai
Decided on: Mar-15-1948
Reported in: AIR1948Bom394; (1948)50BOMLR309
M.C. Chagla, C.J.1. The assessee, which is a company, purchased certain shares during the accounting year and in respect of those shares received an amount of Rs. 3,628 representing dividends paid on those shares. In the return which they made they claimed that this sum of Rs. 3,628 be processed in terms of Sections 16(2) and 18(5) of the Indian Income-tax Act. The assessee was called upon to produce the relevant certificates issued by the companies concerned under Section 20 of the Act. The assessee failed to produce the certificates as they had not been registered by the company in their books as the shareholder in respect of these shares. Thereupon the taxing authorities refused to grant to the assessee the rights and concessions permissible under Section 18(5) and Section 16(2) of the Act.2. The question submitted to us is, whether in the absence of a certificate under Section 20 the assessee's claim in respect of Rs. 3,628 under Sections 18(5) and 16(2) can be validly entertained....
Hamabai J.K. Mehta Vs. Commissioner of Income-tax
Court: Mumbai
Decided on: Mar-15-1948
Reported in: (1948)50BOMLR318
M.C. Chagla, C.J.1. The assessee Mr. Jehangir K.B. Mehta is a beneficiary under a certain trust dated April 8, 1924, executed by his wife Bai Hamabai J.K. Mehta, and one of the benefits that the assessee receives under this trust is that he is entitled to reside rent free in the property known as 'Persepolis.' For the assessment year 1943-44 the Income-tax authorities, instead of assessing the trustees in respect of the income received by them on behalf of the beneficiary, elected, which right they undoubtedly had, under Sub-section (2) of Section 41, to assess the beneficiary directly, and in the assessment order that was served upon the assessee he was charged in respect of this property on the income of Rs. 12,637 which was assessed on the basis of the annual letting value. The assessee claimed the benefit of the proviso to Section 9(2) which entitles the assessee when he is in occupation of the property for the purposes of his own residence not to be liable to tax under this head i...
Dwarkadas Bhimji Vs. the Commissioner of Income-tax
Court: Mumbai
Decided on: Mar-15-1948
Reported in: (1948)50BOMLR346
M.C. Chagla, C.J.1. The four assessees purported to settle certain properties on charitable objects by a trust deed dated January 10, 1936, by a supplementary deed dated March 10, 1937, and by a third deed dated March 12, 1936. The trustees are given the power to utilise the net income on all or any of the charities which are enumerated in the trust deed, and it is clear that some of the objects on which the trustees can spend the trust income are clearly non-charitable. Some of the objects are merely for the benefit and advancement of the family of the settlor, and as it is open to the trustees to apply the whole of the trust income to a non-charitable object, it is clear that the trust is not a good and valid charitable trust. In view of this the Income-tax Department sought to assess the income of this trust as the income of the settlors and Sir Jamshedji's contention before us is that although the trust deeds may be bad as charitable trusts, they are valid for other purposes and th...
Bai Hamabai J. K. Mehta and Others Vs. Commissioner of Income-tax, Bom ...
Court: Mumbai
Decided on: Mar-15-1948
Reported in: [1948]16ITR115(Bom)
CHAGLA, C.J. - The assessee, Mr. Jehangir K. B. Mehta, is a beneficiary under a certain trust dated the 3rd April, 1924, executed by his wife, Bai Hamabai J. K. Mehta, and one of the benefits that the assessee receives under this trust is that he is entitled to reside rent-free in the property known as 'Persepolis'. For the assessment year 1943-44 the Income-tax authorities, instead of assessing the trustees in respect of the income received by them on behalf of the beneficiary, elected, which right they undoubtedly had, under sub-section (2) of Section 41, to assess the beneficiary directly and in the assessment order that was served upon the assessee he was charged in respect of this property on the income of Rs. 12,637 which was assessed on the basis of the annual letting value. The assessee claimed the benefit of the proviso to Section 9 (2) which entitles the assessee when he is in occupation of the property for the purposes of his own residence not to liable to tax under this hea...
Dwarkadas Bhimji and Others Vs. Commissioner of Income-tax, (Central), ...
Court: Mumbai
Decided on: Mar-15-1948
Reported in: [1948]16ITR160(Bom)
CHAGLA, C.J. - The four assessees purported to settle certain properties on charitable objects by a trust deed dated 10th January, 1936, by a supplementary deed dated 10th March, 1937, and by a third deed dated 12th March, 1936. The trustees are given the power to utilise the net income on all or any of the charities which are enumerated in the trust deed and it is clear that some of the objects on which the trustees can spend the trust income are clearly non-charitable. Some of the objects are merely for the benefit and advancement of the family of the settlers and as it is open to the trustees to apply the whole of the trust income to an non-charitable object, it is clear that the trust is not a good and valid charitable trust. In view of this the Income-tax department sought to assess the income of this trust as the income of the settlers and Sir Jamshedjis contention before us is that although the trust deeds may be bad a charitable trusts, they are valid for other purposes and the...
Shree Shakti Mills Ltd. Vs. Commissioner of Income-tax, Bombay City.
Court: Mumbai
Decided on: Mar-15-1948
Reported in: [1948]16ITR187(Bom)
CHAGLA, C.J. - The assessee, which is a company, purchased certain shares during the accounting year and in respect of those shares received an amount of Rs. 3,628 representing dividends paid on those shares. In the return which they made they claimed that this sum of Rs. 3,628 be processed in terms of Sections 16(2) and 18(5) of the Income-tax Act. The assessee was called upon to produce the relevant certificates issued by the companies concerned under Section 20 of the Act. The assessee failed to produce the certificates as they had not been registered by the company in their books as the shareholder in respect of these shares. Thereupon the taxing authorities refused to grant to the assessee the rights and concessions permissible under Section 18(5) and Section 16(2) of the Act.The question submitted to us is, whether in the absence of a certificate under Section 20 the assessees claim in respect of Rs. 3,628 under Sections 18(5) and 16(2) can be validly entertained. Before we consi...
The Commissioner of Income-tax (Central) Vs. Sir Kikabhai Premchand
Court: Mumbai
Decided on: Mar-12-1948
Reported in: (1948)50BOMLR312
M.C. Chagla, C.J.1. The question that we have to answer on this reference turns upon the construction of a deed of settlement executed by Sir Kikabhoy Premchand on February 9, 1940. The trust deed was executed mainly for the purpose of establishing, equipping, and maintaining a sanatorium called Lady Lily Kikabhoy Premchand Sanatorium, Poona, for the benefit of the deserving and needy persons and their families and belonging to specified Hindu communities. The question that we have to answer is, whether on the facts of this case the two sums of Rs. 4,259 and Rs. 4,741, representing the income of this trust, were rightly held to be saved from the application of the provisions of Section 16(1)(c) of the Indian Income-tax Act as amended by the Act of 1989.2. In looking to the trust deed as a whole it seems fairly clear that the settlor while having a genuine intention to make a charitable trust was as genuinely anxious to retain to himself as much power as possible. Although he has appoin...
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