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Showing contexts for: revocable trust in Ito 23 (3)93), Mumbai vs Sme Retail Pool Iv Trust , Mumbai on 30 July, 2021Matching Fragments
4.3.3 The appellant has submitted that the ITAT has already held in its appeal for AY 2010-11 that the findings of the coordinate bench in the lead case of India Corporate Loan Securitization Trust-2008 series 14 will be applicable in its case. In this regard,' I find that on the issue of whether the trust was a not a revocable trust and contribution by beneficiaries was not a revocable Transfer, the ITAT has held. in, para 7.6.5 in the order dated 17.02.2017, asunder:
"In view of the discussion made above and respectfully following the principles laid down in the above referred decision of the Bangalore Bench of the Tribunal in the case of India Advantage Fund-VU and the Mumbai Bench of ITAT in Milestone Army Navy Trust (supra), we hold that the assessee Trust is a revocable Trust and contribution by beneficiaries is a revocable transfer. Having held thus, it follows that the income shall be taxed in the hands of the beneficiaries, i.e. the Mutual Funds who purchase the PTCs from the assessee trust."
4.3.4 It is also noted that in the case of DCIT, Circle 9(1), Bangalore
vs India Advantage Fund-VII, [2014] 50 taxmann.com 3^0, it was
held by the, ITAT Bangalore that case that, the power of revocation
Under Clause 13 of the Deed of Trust is a general power of
revocation an
57. The answer to the above question cannot be given by merely reading the clauses in the contribution agreement alone. The contention of the learned counsel for the assessee before us was that the Contribution agreement has to be read along with the Trust Deed as well as the Investment Management agreement and, offer 'document for private placement issued by the Investment Manager. Article-13 of the Trust Deed provides for termination of the Trust. Though such a power is not with the beneficiary/transferor, it is not the ITA.NO. 7966/MUM/2019 (A.Y: 2009-10) M/s. SME Retail Pool IV Trust requirement of Sec.61 that the power of revocation must be at the instance of the beneficiary/transferor, The 'power of revocation under Clauses of the Deed of Trust is a genial power of revocation and the same would be sufficient for construing the transfer in the present case as a revocable-transfer, As rightly contended by the learned counselfor the Assessee it is not necessary that the power of revocation should be at the.
58. The alternative submission of the learned counsel for the Assessee that the provisions of Sec.63(a) of the Act, which deems existence of power of revocation in certain circumstances are also acceptable. In this regard prospectus:
inviting contribution from contributors clearly lay down in certain circumstances 75% of the contributors can revoke their contribution to the fund at any point of time and the trustees shall then terminate the fund. Though the above power of the transferor/beneficiary to revoke the transfer is not in the instrument of transfer but by virtue of the power conferred in a document by which the investment manager appointed by the-trust by virtue of powers conferred under the trust' deed, would be sufficient to conclude that the transferor/beneficiary had deemed powers of revocation. In this regard the reliance placed by the learned counsel for the Assessee on the ratio laid down in the decision of the Hon'ble Supreme Court in the case of Jyothendrasinhji (supra)is squarely applicable to the present case:. In the aforesaid decision the Hon'ble Supreme Court held that Sec. 63(1) of the Act does not say that the deed of transfer must confer or vest an unconditional or an exclusive power of revocation in the transferor. It was further held, that the. fact that concurrence of the trustee had to be obtained by the transferor/settler for revocation mill not make the trust an irrevocable transfer. In such circumstances it. be held that the deed contains a provision giving the transferor a right to re- assume power directly or indirectly over the whole or any part of income or assets within the meaning of s. 63(a)(ii) of the Act.