Gift-tax Act 1958 s.2(xxiv)(d) — the law in short
What the courts have decided on section Gift-tax Act 1958 s.2(xxiv)(d), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Goli Eswariah v. CGT — throwing self-acquired property into the common stock is a unilateral act and no transfer at all (Gift-tax Act, 1958)
Supreme CourtHelps taxpayer
My client impressed his self-acquired property with the character of joint family property by a declaration. The department says he has made a gift to the family. Is a declaration of blending a transfer?
No. The Supreme Court held that the declaration by which the assessee impressed the character of joint Hindu family property on his self-acquired properties did not amount to a transfer, and so did not attract the Gift-tax Act, 1958. The act by which a coparcener throws his separate property into the common stock is a unilateral act: there is no question of the family rejecting or accepting it, no donor and no donee, and no gift under Chapter VII of the Transfer of Property Act. "Transaction entered into" in s.2(xxiv)(d) of the Gift-tax Act contemplates an act to which two or more persons are parties and cannot apply to a unilateral act, and "disposition" in the opening words of s.2(xxiv), read with the company it keeps, refers to a bilateral or multilateral act. THE ACT CONSTRUED IS THE GIFT-TAX ACT, 1958.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
