We find it convenient to dispose of above two appeals together. main issue is whether department was justified in assessing value of assets held by trust in hands of trustees instead of assessing highly discounted value as returned by assessee. 2. assessees are trustees of private trust which was created on 24- 3-1966. settlor is Champabai Bhogilal. She had transferred some properties to trustees. beneficiaries of trust had been divided into two categories (i) income beneficiaries and (ii) corpus beneficiaries. term 'corpus beneficiaries' is not used in trust deed but we find it convenient to refer so to those persons who are to be considered for distribution of corpus on determination of trust. trustees have been given absolute discretion in applying net income of trust fund every year. It is also open for trustees not to apply net income at all but to accumulate same. 3. Now, determination of trust would be on what is referred to as 'vesting day'. There are two contingencies visualized in trust deed and earlier of two contingencies would determine vesting date. first of contingencies is date on which eldest of beneficiaries mentioned in trust deed and named as qualifying individuals reach age of 71. second contingency is when income beneficiaries get reduced to two persons either by death, renunciation or otherwise. On happening of any of these events, clause 8 of trust deed provides that trustees shall transfer and hand over to such of beneficiaries of first group referred to in trust deed who would be living on vesting date absolutely in such shares as trustees shall in their discretion determine. In case there were no beneficiaries of first group, then trustees shall distribute corpus at their discretion to those person or persons living on vesting day among beneficiaries of second group. Failing any beneficiaries of second group, trustees can choose any from third group. But it is clear that they have clear discretion in deciding who beneficiaries are and their shares. 4. We are concerned with assessments to wealth-tax for assessment years 1978-79 and 1979-80. trustees had invested in certain shares of limited companies. trustees had referred question of determining value of interest of beneficiaries to actuary. actuary took into account number of beneficiaries given on various beneficiary groups in trust deed, determined their respective ages and arrived at finding that property would vest only after period of 31 years. According to him, value of corpus was Rs. 4,28,903. Since beneficiaries would have these properties vesting on them only after 31 years, he arrived at present value of property at Rs. 19,608. This was figure returned in assessment. 5. For assessment year 1979-80 also, similar exercise was done in determining value and return of Rs. 21,399 was made. 6. WTO did not accept return. Following decision in assessments of trust for earlier years, he took present value of shares and did not at all accept discounted value as given by actuary. We may also mention that he did not accept value of corpus either. As against Rs. 4,28,903 determined by actuary, he fixed value at Rs. 7,62,335 for assessment year 1978-79. Similarly, for assessment year 1979-80, as against value of Rs. 4,25,531 fixed by actuary, WTO fixed value at Rs. 9,10,939. 7. assessee appealed. AAC in considered order accepted assessee's contention that what was assessable was only interest of beneficiaries and not entire corpus value of properties. But he did not accept assessee's contention that only discounted value could be taken for assessment purpose. He did not accept premise of actuary that vesting date was 31 years later. He pointed out that trust deed did not fix vesting date unalterably. trust deed had provided for vesting date being preponed to earlier date. It is even theoretically possible that vesting date would be on valuation date itself. Therefore, according to AAC, there was no justification for discounting value of corpus. As assessee was discretionary trust, trustees having unlimited discretion with regard to distribution of trust fund, they were assessable on entire value of corpus of trust as on valuation dates. With this finding, he dismissed appeals. 8. assessee is on further before us. Shri Chokshi for assessee- trust submitted that it is well settled in view of decision of Supreme Court in case of CWT v. Trustees of H.E.H. Nizam's Family (Remainder Wealth) Trust [1977] 108 ITR 555 that department could assess trustees only under provisions of section 21 of Wealth-tax Act, 1957 ('the Act'). If trust were to be discretionary trust, then provisions of section 21(4) would be applicable. Even if this provision were to be applied, he submitted that what is brought to assessment is not value of corpus of trust but value of beneficial interest. Under section 21(1) where beneficiaries and shares are known, valuation is made according to shares specified. Where shares are not known or beneficiaries are indeterminate, he submitted, then under provisions of section one should assume that trustees were holding properties on behalf of one individual who is citizen of India and resident in India. He submitted that fiction created by section 21(4) is to extent of reducing innumerable beneficiaries nominated in trust to one person. He submitted that fiction does not extend further. He submitted that there is no fiction regarding date of vesting of properties. section does not affect trust deed on this point. Therefore, it is not open for fixing up any other date of vesting of properties than what is given in trust deed. He then submitted that as per trust deed date of vesting was 31 years after valuation date. Therefore, in order to evaluation beneficial interest of fictional individual in section 21(4) it has to be discounted. He then submitted that actuary has made proper calculation and it was not open for department authorities to vary this figure. Shri Tej Prakash for department relying on findings of AAC submitted that what WTO has done is only possible method of assessment under law. 9. We have considered submissions. first point made out by Shri Chokshi is that trustees can be assessed only under section 3, read with section 21, of Act. effect of this submission is that what is brought to assessment is not value of properties held by trustees but value of interest of beneficiaries. This submission must be accepted since it is supported by decision of Supreme Court in Trustees of H.E.H. Nizam's Family (Remainder Wealth) Trust's case (supra). following passage occurs: "...Now, whether there is trust, it is obvious there must be beneficiaries under trust, because very concept of trust connotes that though legal title vests in trustee, he does not own or hold trust properties for his personal benefit but he holds same for benefit of others, whether individuals or purposes. It must follow inevitably from this premise that since under sub-sections (1) and (4) of section 21 it is beneficial interest which are taxable in hands of trustee in representative capacity and liability of trustee cannot be greater than aggregate liability of beneficiaries, no part of corpus of trust properties can be assessed in hands of trustee under section 3 and any such assessment would be contrary to plain mandatory provisions of section 21." (p. 595) 10. question then would be what is value of interest of beneficiary on valuation date. Under section 21(4), fiction has been created that there is only one beneficiary who will be individual. So, it is necessary for us to find out value of interest of this beneficiary in trust corpus. valuation of actuary has been made on assumption that properties would vest in beneficiary only on vesting day, i.e., matter of 31 years from valuation date. That is why property value of which is Rs. 4,28,903, has been evaluated at Rs. 19,608. Now, actuary has assumed that individual beneficiary will have no interest in property for period of 31 years. This is totally against trust provisions. We have pointed out that trust is discretionary both on income as well as corpus. Therefore, it is within discretion of trustees to distribute income till vesting day. As per provisions of section 21(4), fictional individual is beneficiary for this income also. Since he is beneficiary for income for period of 31 years, that also should have been taken into account in evaluation. actuary has failed to do so. Therefore, valuation given on assumption that beneficiary will have no interest in property for period of 31 years cannot be correct. fictional beneficiary in section 21(4) is not only full beneficiary of income but also full beneficiary of corpus. This point has been overlooked. 11. omission to consider this aspect, in our opinion, arose out of application of ratio of Supreme Court decision given on facts of Supreme Court case to facts of assessee's case before us. In Supreme Court case, there were two types of beneficiaries, income beneficiary and corpus beneficiary. income beneficiaries were specific and their shares were determinate. There was no dispute between department and assessee that as far as their interest was concerned provisions of section 21(1) would apply. It is only in respect of interest of corps beneficiary that department had invoked provisions of section 21(4) and brought to tax difference between value of properties held by trustees and value of life interest of income beneficiaries. Assuming that in such case provisions of section 21(4) would apply to corpus beneficiaries, Supreme Court had observed as follows: "We have given in preceding paragraph illustration of case falling within section 21, sub-section (1), but illustration can be slightly modified by taking case where property is held on trust for giving income for life to and on his death, to such of children of as trustee might think fit. Section 21, sub-section (4), would be clearly attracted in such case so far as reversionary interest is concerned, because, on relevant valuation date, remainderman and their share would be indeterminate and unknown. But here also two assessments would have to be made on trustee: one in respect of actuarial valuation of life interest of under sub-section (1) of section 21 and other in respect of actuarial valuation of totality of beneficial interest in remainder as if it belonged to one individual under sub-section (4) of section 21. difference between value of corpus of trust property and aggregate of actuarial valuations of life interest of and remainderman's interest would not be assessable in hands of trustee because as pointed out above, trustee can be taxed only in respect of beneficial interests and there being no other beneficiary apart from and such of children of as trustee might think fit, balance of value of corpus cannot be brought to tax in hands of trustee under sub-section (1) or (4) of section 21." (p. 596) Thus, it will be seen from above, that observation would fir into case only where there is life beneficiary to be followed by remainderman. In case only where there is life beneficiary to be followed by remainderman. In such case remainderman has no interest at all till lifetime of life beneficiary. Under those circumstances, it will be justified in totally ignoring income accruing till date of vesting. But in case like one before us, where both life interest and corpus interest are discretionary. there is no question of corpus beneficiary not having any interest at all prior to vesting date. fiction given in steps in and simplifies various types of beneficiaries into one single beneficiary. As per section, individual beneficiary is also beneficiary for income as well as corpus. That being so, his interest cannot be anything less than full interest of freehold property of individual. 12. Even on assumption that 'individual' contemplated in section 21(4) will have no interest in income of property for period of 31 years, even then valuation given is not acceptable. Since trust is discretionary and there is no life beneficiary considered apart from corpus beneficiary, income of trust has to be accumulated and added to corpus. 31 years' income which is added to value of property on valuation date will be more than sufficient to neutralize discounting factor in actuarial calculation. 13. Under these circumstances, we are unable to accept Shri Chokshi's submission. He made point that there is no fiction in section 21(4) regarding date of vesting of properties. We must accept this submission. We have to see position as on valuation date. If on that date any of happening contemplated in clause regarding vesting date has not happened, then one must assume that beneficiary for corpus will be only among those who are mentioned in provisions regarding first vesting date. But acceptance of this submissions does not mean that we are ignoring provisions of trust deed and advancing date of vesting. What we are pointing out is that where complete discretion is given to trustees for income as well as corpus, under provision of section 21(4) there is only one beneficiary both for income and corpus and his interest cannot be less than full value of property. 14. Shri Chokshi also made point that valuation given by actuary should not have been disturbed by WTO since actuary was expert on line. In our opinion, it is open for WTO to consider valuation of properties where expert has made certain assumption in evaluation which is not valid in law. In case before us actuary has assumed that for period of 31 years beneficiary has no interest at all in trust properties. That assumption, as we are pointed out, is not justified on facts of case. 15. appeals are dismissed. *** CMAI FAMILY TRUST v. WEALTH-TAX OFFICER