Judgment :- 1. The following question has been, at the instance of the revenue, referred to us by the Income-tax Appellate Tribunal, Cochin Bench: "Whether on the facts and in the circumstances of the case, the Tribunal is right In law in holding that the bonus shares issued to and received by the donees in 1967 when the donees were in possession and enjoyment of the shares transferred to them by the assessee in 1961 are not assessable in the hands of the assessee?" The assessee in these two cases is the same as the assessee in ITR Nos. 197 to 200 of 1979. Shares had been transferred by the assessee under the instruments of transfer considered by us in the aforesaid cases. The question which arises in this case is, however, not identical. During the period when the transfer was in force, bonus shares had been issued by the company by virtue of the shares held by the transferees. The question is, whether, subsequent to the retransfer of the shares in terms of the instruments, the bonus shares issued in the names of the transferees should be treated, for the purpose of the Wealth Tax Act,1957 (the "Act"), as assets in the hands of the transferees or vice versa. 2. It is true that bonus shares were issued to the transferees and not to the transferor. It is also true that the shares cannot be transferred otherwise than in accordance with the provisions of the Companies Act, 1956. Nevertheless, it cannot be gainsaid that bonus shares were issued on the strength of and by reason of the shares held by the transferees. Although the bonus shares were issued in the names of the transferees, being the holders of the other shares, the bonus shares would not have been issued, but for the other shares. In other words, the bonus shares assumed the character of an accretion, so to say. If that is the position in law, as we think it must be, they must go where the other shares go in terms of the instruments of transfer. However the shares cannot change hands except by means of a proper transfer effected in accordance with the provisions of the Companies Act. Nevertheless, tax is charged not under the Companies Act, bat by the taxing statute. So it is that statute which governs the question. However the shares cannot change hands except by means of a proper transfer effected in accordance with the provisions of the Companies Act. Nevertheless, tax is charged not under the Companies Act, bat by the taxing statute. So it is that statute which governs the question. Sub-s. (5) of S.4 of the Act makes the position clear. It says: "The value of any assets transferred under an irrevocable transfer shall be liable to be included in computing the net wealth of the transferor as and when the power to revoke arises to him." 3. This means that even if the asset transferred under an "irrevocable transfer", as that expression is understood within the meaning of the Explanation to S.4 of the Act which we have considered in ITR Nos. 197 to 200 of 1979, has not been retransfered to the transferor in accordance with the relevant provisions of the Companies Act, for the purpose of a charge under S.3 of the Act, the asset shall be deemed to be an asset of the transferor as soon as the power to revoke in terms of the instrument of transfer arises. If for example, the instrument provides for retransfer on a day subsequent to the expiry of the period of six years, the power to revoke arises on that appointed day whether or not the power has been invoked. Although the shares would continue to remain in the hands of the transferees until revoked, and the income accruing from such shares would be assessable under the Income-tax Act, 1961 in the hands of the transferees, (see Popatlal Bhikamchand v. Commr. of Inc.-Tax, (1959) 36 ITR 577 (Bom.)) such shares will be deemed under the Act to have reverted to the transferor on the day appointed for revocation and will be assessable in his hands as his wealth. This is the irresistible conclusion to which S.4 leads. With respect, we do not agree with the contrary conclusion reached by the Madras High Court in CWT. v. T. Saraswathi Achi, (1980) 125 ITR 186 (Mad.). 4. In the circumstances, we answer the question referred to us in the negative, that is, in favour of the revenue and against the assessee. 5. We direct the parties to bear their respective costs in these Tax Referred Cases. v. T. Saraswathi Achi, (1980) 125 ITR 186 (Mad.). 4. In the circumstances, we answer the question referred to us in the negative, that is, in favour of the revenue and against the assessee. 5. We direct the parties to bear their respective costs in these Tax Referred Cases. A copy of this judgment under the seal of the High Court and the signature of the Registrar shall be forwarded to the Income-tax Appellate Tribunal, Cochin Bench.