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5.The learned counsel appearing for the assessee argued that the property vested in the trustees under the deed dated 11-4-1961 and it continued to vest in the trustees even after the expiry of the period of six years and one day, during which the trust was irrevocable. Even when changes were effected by substituting clause 2(b) and clause (3) of the original trust deed on 31st December 1970, the legal ownership of the property continued with the same trustees. It was submitted that gift tax was paid on the basis of valuation of the entire property when the property was transferred in the names of the trustees under the settlement deed dated 11-4-1961. According to him, mere change in the manner in which the trustees were to manage the property in context of the beneficiaries and specifications of the shares of the beneficiaries did not have the effect of divesting the ownership of the property which had continued to vest in the trustees. He submitted that change in the beneficiaries in some of these settlements did not create any transfer of property, because, the transfer was by virtue of creating a trust itself which was already created under the deed dated 11-4-1961. It was also submitted that, by making the trust irrevocable also, no transfer took place and no new trust was created.

Under the said clause (15), the settlement was irrevocable for a period of six years and one day and admittedly, even after that period, the settlement was not revoked or altered till the deed 31-12-1970 was executed by the settler and signed by all the trustees. By that deed, sub-clause (b) of clause (2) and clause (3) of the Deed of Trust dated 11-4-1961 were substituted and clause (15) thereof came to be revoked.

6.5In the deed dated 31-12-1970 invoking the powers reserved with the settler under clause (15) of the Trust Deed dated 11-4-1961, the settler, "desirous of altering or varying the trusts, powers and provisions contained in sub-clause (b) of clause (2) and clause (3) of the said recited Deed of Trust dated 11-4-1961 and also to revoke clause (15) of the said recited deed dated 11th day of April 1961 and to make the trust irrevocable", executed the said deed.

6.8Furthermore, by the said subsequent deed of 31-12-1970, the settler revoked the earlier clause (15) and made the trust irrevocable. It was, in terms, stated at the end that, save as altered and varied by this document dated 31-12-1970, all other trusts, powers provisions, covenant and conditions contained in the said Deed of Trust dated the 11th day of April 1961 shall remain in full force and effect". This subsequent deed was signed by the settler in the presence of two witnesses and even the trustees had put their signatures in the presence of two witnesses.

10.It was argued that the trust became revocable after six years and one day and therefore, the gift stood revoked and fresh gift was made to the beneficiaries by directing the property to absolutely vest in them after fifteen years and making the trust irrevocable. It was also pointed out that a revocable gift was void under Section 126 of the Transfer of Property Act.

10.1The concept of a gift being void when the donor and donee have agreed that it can be revoked as incorporated in Section 126 of the Transfer of Property Act is altogether different from the concept of revocation of trust as per the power retained by the settler in the Deed of Settlement, as envisaged by Section 77(d) of the Indian Trusts Act, 1882, which, inter alia, provides that, a trust is extinguished when the trust, being revocable, is expressly revoked. There was no express revocation of the trust created under the Trust Deed dated 11-4-1961 nor any resumption of the title to the property which was transferred to the trustees for perfecting the trust under the said Deed of 11-4-1961.