D.D. VYAS, J.M.: Order : assessee is individual. accounting period relevant to asst. yr. 1978-79 ended on 31st March, 1978. During course of assessment proceedings it was found that there was settlement amongst co-owners of properties of which assessee was also party. copy of memorandum dt. 7th July, 1979 was fild by assessee which stipulates arrangement of properties settled amongst various co-owners. according to ITO in terms of this memorandum of agreement, assessee surrendered his rights as co-owner in properties at Malcha Marg and Rajinder Nagar, New Delhi. According to assessee family settlement arrived at between various co-owners was bona fide one and as such it was not correct to say that provisions of s. 4(1)(c) are attracted. GTO was not satisfied with said Explanation. According to him assessee had surrendered his share of properties in question and such provision of s. 4 (1)(c) are attracted. value of deemed gift was estimated at Rs. 6,28,050. After giving statutory exemption of Rs. 5,000 value of deemed gift was determined at Rs. 6,24,050. 2. ld. CIT(A) was of view that there was no bona fide settlement. According to him whole transaction was sham. Thus ld. CIT(A) agreed with finding of GTO. 3 . Before Tribunal, on behalf of appellant, it was contended that finding of ld. CIT(A) is not correct. That on death of Sajjan Singh on 11th Sept., 1977, share of his legal heirs in four properties in Delhi stood revised by virtue of succession as per Indian Succession Act. co-owner who were closely related to each other had feared and raised doubts that same disputes or differences might arise amongst themselves or later amongst their legal heirs with respect to co-owner properties and all co-owners with view to keep harmony and maintain peace amongst family members desired settlement and re-arrangement of shares. On occasion of Kirya ceremony of Sajjan Singh all co-owner agreed to settlement and re-arrangement of shares in properties and that it was as result of this arrangement and settlement that appellant Santokh Singh who was maternal uncle of other co-owners namely, Mohinder Singh, Amrik Singh, Hari Singh sons of Late Sajjan Singh and Smt. Shakuntala, married daughter of Sajjan Singh and thus only outsider decided to abondon his share in two co-owned properties, namely, 7-B, Rajinder Park, New Delhi, and 130 Malcha Marg, New Delhi in favour of other family members and offspring of Late Sajjan Singh in bona fide manner. After settlement he shifted to patiala to stay with his three sons. subsequently, this settlement was reduced into writing in shape of memorandum of agreement on 7th July, 1979. According to counsel gift tax Authorities have wrongly invoked provisions of s. 4 (1)(c) of GT Act and held that value of assessee s interest in two properties surrendered by him was deemed gift to be brought to tax in his hands. Reliance was placed on ratio of decisions in cases of Zianddin Ahmed vs. CGT 1976 CTR (Gau) 161 : (1976) 102 ITR 25 3 (Gau). 4 . Departmental Representative supported order of CIT(A). According to him settlement took place on back date. memorandum o f agreement is dt. 7th July, 1979 but it was made applicable from 11th Sept., 1977. It was also contended that it does not stand to reason that in settlement Santokh Singh would surrender his right in such way which was alleged in present case. evidence produced by assessee is not reliable. Thus it was contended that there was no material to show that settlement is bona fide. 5 . We have heard parties and perused entire material on record. fact of case as stated in order of CIT(A) are not dispute. assessee has filed affidavits of Mohinder Singh, Amarjit Singh, Gurmit Singh, Amrik Singh, Hari Singh, Santokh Singh, Smt. Shakuntala, Gurdial Singh all these persons are co-shares in properties in dispute. There is also affidavit of B. L. Kashyap who is outsider. In his affidavit he stated that settlement amongst co-owners of properties in dispute at time of kirya ceremony of late Sajjan Singh was arrived at. Affidavit of Sunder Singh, outsider also shows that at time of Kirya ceremony of Sajjan Singh there took place of family settlement. In this affidavit it was clearly stated that at time of family settlement. In this affidavit it was clearly stated that at time of settlement it was mutually agreed that shares in properties were allotted as under : 7-8,Rajindra Park, (a) S. 50 "1. New Delhi Mohinder Singh per cent (b) S. 25 . . Amarjit Singh per cent (c) S. 25 . . Gurmit Singh per cent 130 Malcha Marg, S. Amrik 100 2. New Delhi Singh per cent 154, Golf Links, S. Hari 100 3. New Delhi Singh per cent C-552, Defence (a) Smt. 50 4. Colony, New Delhi Shakuntla per cent (b) S. 40 . . Monmohan per cent Singh (c) S. Brij 10 . . Nandan Singh per cent That S. Santokh Singh abandoned all his shares and interest in properties, 7-8, Rajindra Park, New Delhi and 130, Malcha Marg, New Delhi." In affidavit it was also stated that Sontokh Singh abandoned all his shares in property No. 7-8 Rajindra Park and 130, Malcha Marg, New Delhi. T o same effect are affidavits filed by co-owners. Even in memorandum of agreement dt. 7th July, 1979 these facts were clearly stated. GTO or CIT(A) never brought on record any material to show that affidavits filed by assessee were not reliable. On other hand, all affidavits are quite detailed and there is nothing on record as to why such affidavits should not be accepted. There is also nothing on record to show that memorandum of agreement is not genuine. 6 . It is settled law that apparent state of affair should be accepted as correct unless contrary is proved. Gift-tax authorities did not bring on record any evidence to show that these materials were not genuine. On face of overwhelming evidence it can hardly be accepted that these documents are not genuine. 7 . In affidavits and even in memorandum of agreement it was clearly stated that family settlement was arrived in order to avoid any differences or disputes that might arise amongst co-owners of properties, Santokh Singh in his affidavit clearly stated that he bona fidely abandoned his share in properties in order to avoid disputes, differences or misunder standing which may arise amongst all co-owners for all times to come. It was also stated that it was necessary because properties which had been respectively allotted on re-allocation were in their possession and title deeds also were registered in names of respective co-owners. It was also stated that no formal deed was considered necessary because title deeds were already registered in respective names. If all aforesaid material is taken into consideration it is established that family settlement was bona fide and genuine. 8. In decision in case of Ram Charan Das AIR 1966 SC 323, Supreme Court at p. 329 of report observed as under : "Court gives effect to family settlement upon broad and general ground that its object is to settle existing or future disputes regarding property amongst members of family. word family in context is not to be understood in narrow sense of being group of persons who are recognised in law as having right of succession or having claim to share in property in dispute." In decision in Smt. Hiran Bibi AIR 1914 PC 44, it was pointed out that in family settlement each party takes share in property by virtue of independent title which is admitted to that extent by other parties. It is not necessary, as would appear from decision in Rangasami Gownden, AIR 1918 PC 196, that every party taking benefit under family settlement must necessarily be shown to have, under law, claim to share in property. All that is necessary is that parties must be related to one another in some way and have possible claim to property or claim or even semblance of claim on some other ground as, say, affection. 9. Looking to aforesaid facts and ratio of decisions in cases referred to above, we are of view that settlement of dispute in family was bona fide and genuine, under circumstances provisions of s. 4(1)(c) are not attracted. finding of CIT(A) to contrary is not correct Accordingly additions are deleted. 10. In result appeal is allowed. *** SANTOKH SINGH v. GIFT TAX OFFICER