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7. The assessee being aggrieved by the aforesaid decision of the AAC appealed to the Tribunal. It was submitted before the Tribunal on behalf of the assessee that the revenue authorities were wrong in holding that the trust was a revocable one. It was argued that it was only the power reserved in the trust deed for the settlor to reassume the trust property or any income therefrom that could make the trust revocable and not merely the fact of the settlor getting any benefit of the trust property or the income therefrom. In support of this contention, reliance was placed on certain decisions, which we shall presently notice. It appears that the attention of the Tribunal was drawn to Clause 13 of the trust deed. It was also urged that the assessee did not derive the benefit of the income form the trust property by withdrawing the said amount free of interest and the income of the trust was not affected by such withdrawal and even if the assessee had derived any benefit then that by itself would not render the trust a revocable one. On behalf of the revenue reliance was placed on the reasonings given by the ITO and the AAC. It was argued that the various clauses gave power to the settlor to reassume the property or income of the trust, to get directly or indirectly, benefit from the income or assets of the trust. It was further argued that it was not material that the power was to be exercised by the settlor alone or with the consent of the beneficiaries or other trustees. The Appellate Tribunal, after considering the provisions of Sections 61, 62 and 63 of the Act, observed as follows :

" Section 61 provides for the inclusion of the income of the trust in the hands of the settlor in case the trust is a revocable one. Section 62 provides exceptions in certain cases to Section 61. Section 63 makes a provision for cases wherein a transfer shall be deemed to be revocable. What is to be seen is whether under Section 63 the trust in question was revocable or not. Clause 8 of the trust deed gives an uncontrolled power to the trustees to invest the trust property in such manner as they like. Clause 19 further provides for the investment of the trust property in such manner as they like. Clause 19 further provides for the investment of the trust funds in any concern in which the trustees are directly or indirectly interested. The contention of the learned counsel for the assessee is that these powers are to be exercised not by the settlor alone as a trustee but by all the trustees and according to him in such circumstances it cannot be said that any power is reserved to the settlor for deriving any direct or indirect benefit out of the trust property. The facts in the case of CIT v. Ragbhir Singh were that the settlor was allotted 400 shares in a company along with other properties on the partition of a joint Hindu family of which he was a member and was also made liable to pay a business debt. He created an irrevocable trust in respect of 100 shares and the income of the trust after the discharge of the debt was to be applied for the benefit of the beneficiaries. It was held that the provision for the application of the income for the payment of the debt which the settlor was under an obligation to pay did not amount to a provision for retransfer of the income or the assets to the settlor or to his being invested with a power to resume the income of the assets. The settlor did obtain a benefit from the trust but on that account the first proviso to Section 16(1)(c) of the Indian I.T. Act, 1922, was not attracted and the income from the shares could not be deemed to be the settlor's income or included in his total income. It was on the construction of the deed itself that their Lordships came to the above conclusions. The facts of the present case are quite different and the authority cited by the learned counsel for the assessee is not applicable to the facts of the present case, It has been held in the case of Behramji Sorabji Lalkaka v. CIT [1948] 16 ITR 301 (Bom), that the expression 'revocable' in Section 16(1)(c) of the Indian I.T. Act, 1922, is not qualified in any manner and that a section does not speak for absolute and unqualified power of revocation and for the purpose of Section 16(lXc) a transfer is nevertheless revocable even if it can be revoked only with the consent of any named person or persons. Even if the assessee has to exercise the uncontrolled power of investment of the trust money in any concern in which the assessee is interested along with the other trustees that would not in any way detract from the reservation of a power for deriving any indirect benefit by the assessee."

19. In the case of CIT v. Jayantilal Amratlal [1968] 67 ITR I, the Supreme Court was dealing with the case of a settlor, who had executed a trust deed, whereby he had created a trust of certain shares of a company for charitable purposes. The deed was registered under the Bombay Public Trusts Act, 1950. Under Clause 4 of the deed the settlor could direct the trustees to set aside any port ion of the income of the trust for certain temples. Clause 6 enabled the settlor at any time to direct that any specific fund or investment or property that formed a part of the trust and/or income thereof should be utilised and applied exclusively for any one or more of the charitable objects. Under Clause 8 the settlor had power to direct the trustees to hand over the income of the trust or any part thereof to any institution, association or society to be applied for all or any of the charitable purposes without being bound to see to the application thereof. Under Clause 10 the settlor had power to direct the trustees to invest the trust fund in shares of companies or any debentures or in giving loans to any public company or firm of good standing and reputation. Under Clause 11 the settlor could direct the trustees to vary the investment. Clause 21 provided that " all questions arising in the management and administration of the trusts or powers hereof and all differences of opinion among the trustees shall be disposed of in accordance with the opinion of the settlor during his lifetime..." The question was whether the income of the trust could be assessed in the hands of the settlor on the ground that he had a right to reassume power over the trust funds or the income thereof as contemplated by the first proviso to Section 16(1)(c) of the Indian I.T. Act, 1922. It was held that none of the clauses of the trust deed came within the purview of the first proviso to Section 16(1)(c) and that the income of the trust could not, therefore, be assessed in the hands of the settlor. The power under Clause 4 to direct the application of income of the trust to a particular charitable purpose or the power (under $1. 6 to nominate the charitable object and the fund or investment which should be utilised for that object was in no sense the power to reassume control over the asset of the trust or the power under Clause 8 to direct the trustees to hand over the income of the trust or any part thereof to any institution or society or association to be applied for all or any of the charitable purposes without being bound to see to the application thereof was the power to reassume control over the asset or income of the trust. Clauses 10 and 11 which enabled the settlor to give directions regarding the investments had to be read according to the Supreme Court, subject to the provisions of the Bombay Public Trusts Act and the general principles of law relating to trusts. The settlor could not legally direct to give a loan to himself and any loan to the business in which the settlor was interested. The settlor did not have the power to give such a loan by virtue of Section 16(1)(c) of the Act. Clause 21 which provided that all questions arising in the management and administration of the trust and all differences among the trustees should be disposed of in accordance with the opinion of the settlor gave a wide power which the settlor had reserved to himself. None of these clauses came within the purview of the first proviso to Section 16(1)(c) of the Act. The first proviso contemplated only the case where the settlor could lawfully reassume power over the income or the assets of the trust. The latter part of the first proviso contemplates that the settlor should be able by virtue of something contained in the trust deed to take back the power he had over the assets or income previous to the execution of the trust deed. A provision enabling the settlor to give directions to the trustees to employ the assets or funds of the trust in a particular manner or for a particular charitable object contemplated by the trust deed could not be said to confer a right to reassume power within the meaning of the first proviso to the Act, otherwise the settlor could never himself become the sole trustee. Learned advocate for the revenue sought to urge that this decision was given in view of the provisions of the Bombay Public Trusts Act which contained an express prohibition against investment to the settlor of the loan to the settlor of the funds belonging to the settlor. According to the learned advocate for the revenue, if this aspect is not borne in mind then the true ratio of the decision could not be appreciated.

"What then is the fair meaning of Section 16(1)(c), proviso (i)? It seems to us that the words 'reassume power' give indication to the correct meaning of the proviso. The latter part of the proviso contemplates that the settlor should be able, by virtue of something contained in the trust deed, to take back the power he had over the assets or income previous to the execution of the trust deed. A provision enabling the settlor to give directions to trustees to employ the assets or funds of the trust in a particular manner or for a particular charitable object contemplated by the trust cannot be said to confer a right to reassume power within the first proviso. Otherwise a settlor could never name himself a sole trustee. It seems to us that the latter part of the proviso contemplates a provision which would enable the settlor to take the income or assets outside the provisions of the trust deed. Mr. Desai says that if a settlor can derive some direct or indirect benefit under a trust deed, the trust deed would fall within the first proviso. But the first proviso does not use these words. The words ' direct or indirect benefit' occur only in the third proviso. This court held in Commissioner of Income-tax v. S. Raghbir Singh , that although the settlor in that case obtained a benefit from the trust--payment of his debts--the first proviso was not attracted."