ASSISTANT CONTROLLER OF ESTATE DUTY Vs. SARDAR MOHANSINGH SANTRAM
INCOME TAX APPELLATE TRIBUNAL
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B.V. Venkataramaiah, Accountant Member -
(1.) THIS is an appeal against the order of the Appellate Controller annulling the assessment made by the Assistant Controller. Smt. Mayadevi Santram Huda died on 26-12-1964. The Assistant Controller issued a notice under Section 55 of the Estate Duty Act, 1953 ("the Act"), on 16-8-1974. The accountable person Sardar Mohansingh, filed the estate duty return on 5-5-1975 and the assessment was completed on 30-10-1978 determining the value of the estate at Rs. 91,999. The contention before the Appellate Controller was that the notice under Section 55 was issued beyond the time limit specified in Section 73A(a) of the Act and as such was invalid. The Appellate Controller rejected the plea of the revenue that the return was filed voluntarily by the accountable person and as such Section 73A(a) did not apply. He gave a clear finding that the return was in response to the notice issued on 16-8-1974. In effect the Appellate Controller held that the Assistant Controller commenced the proceedings for levy of estate duty after the expiry of five years from the date of death and as such the assessment was time barred. The revenue is in appeal.
(2.) The learned departmental representative, Shri P.B. Charles, advanced an ingenious argument that the return filed by the accountable person should be considered as a voluntary return. In the case of voluntary returns, the provisions of Section 73A(a) will not apply since the Assistant Controller would not be deemed to have commenced any proceedings for the purposes of making the estate duty assessment. The first leg of his argument was that the notice under Section 55 issued five years after the date of death was ab initio void, it was non est and so has to be totally ignored. Hence, the return filed by the accountable person will be a return not in response to the notice under Section 55, but a return filed on his own volition. The accountable person could not be said to have complied with an illegal notice since such a notice did not exist at all in the eye of law. The second leg of the argument was that when a person files the return on his own volition, the limitation prescribed under Section 73A(a) does not apply. Incidentally he referred to a judgment of the Allahabad High Court in the case of CED v. Bhola Dutt  130 ITR 468. In that case the High Court had observed that the provisions of Section 73A are applicable even to an ex parte assessment where an accountable person has not delivered the accounts as required under Section 53 or 56 or Section 58(2) of the Act. He drew our attention to Section 58(4) which permits the Assistant Controller to complete an assessment where no account has been delivered. He submitted that the observations of the High Court are not quite appropriate since a person requiring grant of representation, etc., may submit the estate duty return at any time he pleases and the Assistant Controller can make an assessment and furnish a certificate to the applicant for grant of representation. In such a case the .provisions of Section 73 A will not be applicable at all. On the above grounds, it was urged that the Appellate Controller's order should be set aside.
2.1 The learned counsel for the accountable person, on the other hand, submitted that it is not possible to infer that a voluntary return has been filed in this case. The return was prompted by the notice issued by the Assistant Controller. Although the notice itself was issued beyond the time limit specified in Section 73A, the return submitted by the accountable person could under no circumstances be deemed to be a voluntary return. Incidentally, it was not seriously contended that a voluntary return could be filed by an accountable person beyond the time limit specified under Section 73A and still the estate duty assessment could be made enabling the accountable person to obtain a certificate of payment of tax for the purposes of grant of representation, etc.
We have no difficulty in accepting the second leg of the argument of the learned departmental representative, namely, that if a voluntary return of estate duty is filed by the accountable person beyond a period of five years from the date of death of the person whose estate was liable to estate duty, the time limit specified under Section 73A will not apply since it could not be said that the Assistant Controller has commenced any proceedings for the levy of estate duty. In that case the proceedings do not commence at the instance of the Assistant Controller. The section reads as follows:
73A. No proceedings for the levy of any estate duty under this Act shall be commenced-
a. in the case of a first assessment, after the expiration of five years from the date of death of the deceased in respect of whose property estate duty became payable ; and
b. in the case of a re-assessment, after the expiration of three years from the date of assessment of such property to estate duty under this Act.
A reading of the section clearly indicates that the proceedings should be commenced by the Assistant Controller. Thus, there is no bar of limitation when the proceedings are commenced at the instance of the accountable person.
(3.) HOWEVER, the crucial point in this case is whether the return has been filed by the accountable person voluntarily. The meaning of the word "voluntary" is quite clear. The Chamber's Twentieth Century Dictionary gives the following meaning for the word "voluntary" :
Voluntary: acting by choice, able to will : proceeding from the will: spontaneous, free : done or made without compulsion or legal obligation : designed, intentional: freely given, or supported by contributions freely given : free from State control.
Thus although the notice issued by the Assistant Controller was ab initio void, it still had the effect of forcing the accountable person to submit an estate duty return. Therefore, the return submitted is not voluntary. It cannot be equated with the return filed by the accountable person for some purpose, say, obtaining grant of representation, etc. In this view of the matter, we agree with the learned Appellate Controller and dismiss the appeal filed by the revenue.;
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