Sec. 4, 5 & 145 of Income Tax Act, 1961— Income—In order to determine whether there has been a diversion of income by overriding title the true test is whether the amount sought to be deducted, in truth, never reached the assessee as his income. Where a superior title is created before any income accrues or arises, it would be the diversion of income by overriding title but where there is no obligation attached and income is applied as per assessee's own choice after it accrues, it will not be a case of diversion by superior title as no superior title existed and just because diverted income is collected by the assessee himself for and on behalf of the beneficiary. It cannot be inferred that it was only an application and not diversion and in the case of assessee, the assessee has been obligated by virtue of the agreement to divert the income at source and also for the contributions made by the holding company, thus, it was held that the Revenue sharing agreement entered with the holding company by the assessee is diversion of income by overriding title, therefore, the Revenue's contention that the entire transaction is sham and aimed at only to divert the income to EMLL cannot be said to be correct based on the facts and the judicial pronouncements — DY. CIT Vs. EMMAR MGF CONSTRUCTION (P.) LTD. [2020] 204 TTJ 148 (ITAT-DELHI)