COMMISSIONER OF INCOME TAX vs. DHIJEN DARSHI FAMILY TRUST

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ITR/232/1991HC GujaratGJHC24013465199116 January 2001Author: HONOURABLE MR. JUSTICE J.M.PANCHAL,HONOURABLE MR. JUSTICE MOHIT S. SHAH2 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the Tribunal was right in law in directing the ITO to treat the assessee as a specific trust. This decision was based on the concession made by the Revenue's counsel, who acknowledged that the issue was concluded by a Division Bench judgment of the same High Court in the case of Commissioner of Income Tax v. Dhijen Dharshi Family Trust (the same assessee) for I.T.R.No.179 of 1985, decided on September 21, 2000. The High Court found no reason to deviate from this established precedent. The reference was answered in favour of the assessee and against the Revenue. No issue was left undecided.

What were the facts?

The Income Tax Appellate Tribunal (ITAT) referred a question of law to the High Court of Gujarat concerning the assessment year 1981-82. The assessee, DHIJEN DARSHI FAMILY TRUST, claimed to be assessed as a specific trust. The Income Tax Officer (ITO) rejected this claim and treated it as a discretionary trust. The Appellate Assistant Commissioner (AAC) overturned the ITO's decision and accepted the assessee's claim. The ITAT upheld the AAC's order, relying on its previous decision for the assessment year 1980-81 in the same assessee's case. The Revenue appealed this decision to the High Court.

What were the issues?

1. Whether the Tribunal was right in law and on facts in directing the ITO to treat the assessee as a specific trust (turning on the interpretation of provisions related to trust classification under the Income Tax Act). Assessee's Contention: The assessee contended that it should be assessed as a specific trust. (No specific arguments or authorities are recorded for the assessee in the judgment). Revenue's Contention: The Revenue argued that the Tribunal was not right in directing the ITO to treat the assessee as a specific trust. However, the Revenue's counsel conceded that the controversy was concluded by a prior judgment of the High Court in the assessee's own case.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No 232 of 1991

For Approval and Signature:

Hon'ble MR.JUSTICE J.M.PANCHAL and Hon'ble MR.JUSTICE M.S.SHAH

============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements?

2.

To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement?

4.

Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder?

5.

Whether it is to be circulated to the Civil Judge? :

-------------------------------------------------------------- COMMISSIONER OF INCOME TAX Versus DHIJEN DARSHI FAMILY TRUST -------------------------------------------------------------- Appearance: MR MANISH R BHATT for Petitioner NOTICE SERVED for Respondent No. 1

--------------------------------------------------------------

CORAM : MR.JUSTICE J.M.PANCHAL and MR.JUSTICE M.S.SHAH

Date of decision: 16/01/2001

ORAL JUDGEMENT (Per : MR.JUSTICE J.M.PANCHAL)

At the instance of Revenue, the Income Tax Appellate Tribunal has referred following question of law for opinion of this Court in respect of Assessment Year 1981-82 :

"Whether, the Tribunal was right in law and on facts in directing the I.T.O. to treat the assessee as a specific trust ?"

2.

Though served, no one appears on behalf of the respondent.

3.

The assessee in the course of assessment proceedings claimed that it be assessed in the status of a specific trust. This was rejected by the I.T.O., who accorded the status of a discretionary trust. The A.A.C., however, accepted the case of the assessee and treated the assessee as a specific trust. The Tribunal has confirmed the order of the A.A.C. relying on its own decision in the assessee's case for Assessment Year 1980-81 in I.T.A. No. 2310/Ahd/83. 4. We have heard the learned counsel for the Revenue. The learned counsel states that the controversy raised in the present Reference is concluded by the judgment of Division Bench of this Court comprising Hon'ble the Chief Justice and Mr.Justice A.R.Dave rendered in the case of Commissioner of Income Tax v. Dhijen Dharshi Family Trust (this very assessee), in I.T.R.No.179 of 1985, on September 21, 2000. In view the decision of the High Court, we are of the opinion that the Tribunal was right in law in directing the I.T.O. to treat the assessee as a specific trust. The Reference is, therefore, answered in favour of the assessee and against the Revenue. The Reference accordingly stands disposed of, with no order as to costs.

(patel) (J.M.Panchal,J.) (M.S.Shah, J.)

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