Judgment

SHAH, J.:- C. R. Nagappa executed on April 14, 1955 seven separate deeds of trust settling specific properties for the benefit of his minor children. Under each deed Nagappa settled certain properties for the benefit of his named minor child and vested the properties in four trustees - Nagappa, his two wives and a married daughter. Under each deed of trust a portion of the income arising out of the trust property was to be utilised immediately for the benefit of the beneficiary and the balance was to be accumulated for his or her benefit and to be handed over to the beneficiary at a future date specified in the deed.

2. In the proceeding for assessment for the year 1962-63 the 5th Income-tax Officer, City Circle II, Bangalore, included in the total income of Nagappa the income arising from the trust properties and used for the immediate benefit of the beneficiaries, but not the income directed to be accumulated. The Commissioner in exercise of the power under Section 263 of the Income-tax Act, 1961, directed that the income for the deferred benefit of the minor beneficiaries be also included in the total income of Nagappa. In appeal against that order to the Income-tax Appe