| 6/1/2009 |
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| Board of Special Commissioners - Cases |
| Case No. 27/56 |
Decided: 19 December, 1956 |
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Interpretation of the word "disposition" in article 21, now 51, Income Tax Act
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The point at issue was the interpretation of the operative word "disposition" in article 21 of the Act, where unmarried children were concerned. Appellant held that it referred only to transfers by gratuitous title. The Commissioner, on the other hand, argued that the provisions of the article effected transfers both by onerous and gratuitous title including the transfer of assets and sales. The Commissioner based his argument on the fact that the word "disposition" is not tacit but meant to serve as an example.
The Board noted similarities between the Maltese and English legal texts and the fact that both jurisprudence and authors on the subject always held that only gratuitous dispositions fell within the arrangements referred to in the article. In this context it is important to note the use of the words "paid to or for the benefit of a child...." It was evident that the legislator had in mind a transfer by gratuitous title, since in the case of a transfer by onerous title both parties are apt to benefit.
Though the word "disposition" has various definitions (which would include transfer by onerous title) in English dictionaries it has always been defined as a bestowal when referring to a transfer. "Bestowal", in turn, means "to confer by deed or gift" and thus excludes transfer by onerous title. "Disposition" in sub-article 21(3) should always be interpreted within the concept of a bestowal.
One also noted that in sub-article 21(1) the two alternatives of "transaction" and "disposition" are provided for, whereas in sub-article 21(2) only "disposition" is mentioned. This went to prove that in the second sub-article, the word "disposition" has a restrictive meaning, whereas in the first one it refers to all types of arrangements, both onerous and gratuitous so long as they are fictitious.
This decision was appealed in front of the Court (Case No. 18).
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