Judgment :- R. JAYASIMHA BABU, J. The questions referred to us are, "whether on the facts and circumstances of the case, the Tribunal was right in treating the difference between the value of shares in Food Specialities as per the Delhi Stock Exchange rate and the consideration received by the assessee as deemed gift under section 4(1)(a) of the Gift-tax Act, 1958 ?" Whether, the Tribunal was right in holding that capital gains accepted by the Income-tax Officer for the same assessment year on the basis of admitted sale price was of no consequence for the purpose of the Gift-tax Act ? "The assessment year is 1976-77. The assessee had transferred 2000 shares in a company, Food Specialities, whose shares are quoted at several stock exchanges including those at Bombay and Delhi. The shares were quoted at the rate of Rs. 20.75 on the date on which the assessee sold the shares, the sales having been effected to his relatives, The rate at which the sale was effected was at Rs. 20.75 per share. The amount realised from the sale of shares was accepted as the true consideration for the sale in the income-tax proceedings relating to the assessee, as also in the wealth-tax proceedings. The Gift-tax Officer, however, took the view that there was a gift for a sum of Rs. 71, 000 to the vendees as the price for the very same share quoted at the Delhi Stock Exchange at the time of transfer was Rs. 35.50 per share. That view of the Assessing Officer had been upheld by the Commissioner and the Tribunal. It was contended by learned counsel for the assessee that the Tribunal has erred in holding that there was a gift, by adopting a rate at which the shares were traded at the Delhi Stock Exchange when the price at the Bombay Stock Exchange was undisputed and the assessee had in fact sold the shares at the rate at which the shares had been quoted at the exchange at Bombay. We find considerable force in the submissionSection 4 of the Gift-tax Act as it stood at the relevant time refers to transfer of property otherwise than for adequate consideration. We find considerable force in the submissionSection 4 of the Gift-tax Act as it stood at the relevant time refers to transfer of property otherwise than for adequate consideration. Section 4(1)(a) provides that" Where the property is transferred otherwise than for adequate consideration, the amount by which the market value of the property at the date of transfer exceeds the value of the consideration shall be deemed to be a gift by the transferor". The proviso to section 4(1)(a) is not of much relevance for the purpose of this case. Section 4(1)(a) speaks of adequate consideration and market value and deems the market value to be the adequate consideration for the purpose of the section. Market value has to be determined with reference to the price that a willing purchaser dealing at arm's length will be prepared to pay for the asset. In respect of shares the "market" is the stock exchange. The rates quoted at the stock exchange, in a case where shares are traded in more than one exchange, are likely to vary from exchange to exchange, and may not be uniform in all exchanges in the country. The fact that the shares sold by the assessee, was traded in the Delhi Stock Exchange at a rate higher than the rate at which they were traded at the Bombay Stock Exchange, would not imply that the rate quoted at the Bombay Stock Exchange was not the market rate. If it were to be held that it is only the higher rate at which a share is traded in any stock exchange in the country that is the market value of that share on that date, every other seller of shares on that given date, in every other exchange would have to be treated as having made a gift of the amount by which the shares quoted at the exchange and at which the shares were sold, was less than the rate at which the higher rate had been quoted for it in any other exchange in the country. It would result in absurd consequences. Shares are traded in large volumes and the number of investors and speculators trading in any exchange are substantial in number. The Gift-tax Act was not intended to treat all of them as donors even when they had sold the shares on the exchange at the rate quoted at the exchange. It would result in absurd consequences. Shares are traded in large volumes and the number of investors and speculators trading in any exchange are substantial in number. The Gift-tax Act was not intended to treat all of them as donors even when they had sold the shares on the exchange at the rate quoted at the exchange. So long as the rate at which the shares have been sold is found to be the rate at which shares were quoted in any of the stock exchanges in the country where the said shares are traded, that rate must be accepted as the market value for the purpose of the Gift-tax Act. Even after the amendment to section 4 by insertion of the new Schedule to the Act, the reference therein is only to the quantification and there is no requirement that the higher quotation in any of the other exchanges in the country for the shares of the company in question should be treated as the market value. In respect of shares traded in the stock exchange there are in fact several markets, each exchange constituting a market and the rate quoted therein is the market rate for that exchange. Thus, for shares there can be as many market rates as there are stock exchanges on which these shares are tradedThe Tribunal was in error in holding that there was any gift. The questions referred are, therefore, answered in favour of the assessee and against the Revenue. The assessee shall be entitled to costs of a sum of Rs. 1, 500.