Decided on October 05,1966

B.K. SHANTIRAJ Appellant


Hegde, J. - (1.)THE estate duty assesssment pertains to the estate of lat Chandraraja Savantha Madda Hegde, who did on 29th June, 1955. Shir B. K. Shantiraj, son of the deceased, furnished to the Assistant Controller of Estate Duty, Banglore, who was the assessing authority, an account of property passing on the death of the deceased.
(2.)THE deceased's assets, amongst others, consisted of agricultural lands which were situated in Udipi and Mangalore taluks of South Canara which were all leased to tenants. THE accountable person showed the value of these lands in the estate duty return at Rs. 1,71,390. THE Assistant Controller considered that the lands were grossly under-valued. THE accountable person contended that some lands in those areas were sold for lower prices. THE Assistant Controller, however, rejected the accountable person's contention as the extent of the lands sold and their yield was not furnished by him and also as the sales were effected in 1959, i.e., nearly four years after the date of valuation in this case. On the basis of the reports from the Tahsildars, the Assistant Controller fixed the value of those hands at Rs. 3,44,160. THE assessement was accordingly completed fixing the principal value of the estate at Rs. 3,95,036. A copy of the assessment order is annexure "C" and forms part of the case.
The accountable person appealed to the Board. When the case came up for hearing, the Board felt that certain further information was necessary for deciding the issue. They, therefore, remanded the case back to the Assistant Controller for further enquiry and report. A copy of the order of remand dated the 21st June, 1960, is annexure "B" and forms part of the case.

After the receipt of the remand report, the Board reheard the appeal. It was contended for the appellant that the valuation of the agricultural lands as made by the Assistant Controller was excessive and not in accordance with rule 14(6) of the Estate Duty Rules as it stood in 1955, which provided for valuation of such lands at twenty times their annual value. Alternatively, it was contended that the valuation of those should have been made according to the accepted methods, i.e., by capitalising the net annual yield or immediate prospective yield of those lands at a reasonable number of years purchase.

(3.)FOR the reasons mentioned in paragraph 10 to 14 of their order dated the 13th February, 1962, the Board rejected the accountable person's contention. On the basis of the gross annual yield, as intimated by the Assistant Controller in his report and accepted by the accountable person, the Board fixed the market value of those lands at Rs. 3,00,000 as worked out in paragraph 15 of their order. A reduction of Rs. 44,160 was accordingly allowed. A copy of the order of the Board is annexure "A" and forms part of the case.
On the facts stated above, the following question of law arises and is referred for the opinion of the High Court of Mysore at Bangalore :

"Whether, on the facts and in the circumstances of the case, the value of the agricultural lands was properly determined at Rs. 3,00,000, having regard to the provision of section 36 of the Estate Duty Act, 1953, and rule 14(6) of the Estate Duty Rules as it stood before its amendment in 1956 ?"

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.