Decided on March 13,1972

N.V. SOMARAJU Appellant


Gopal Rao Ekbote, J. - (1.) THIS is an application filed under Article 226 of the Constitution of India for the issue of a writ to declare the provisions of Section 34(1)(b) and (1)(c) of the Estate Duty Act, 1953, as ultra vires and unconstitutional. It is also prayed that the respondents should be restrained from enforcing these provisions in respect of the estate of the petitioner's father.
(2.) THE material facts are that one Nuli Laxminarayana and his son, the petitioner, constituted a Hindu undivided family governed by the Mitakshara law. THE petitioner's father died on March 6, 1966, at Vellore in the State of Madras. THE family had extensive properties consisting of agricultural lands situate in West Godavari District, A.P., residential house, godowns, cattle shed, cinema theatre, etc. Under the Estate Duty Act of 1953, on the death of the petitioner's father, the estate of the deceased father, which is deemed to have passed on to the petitioner, was liable to pay estate duty. The third respondent, i.e., the Assistant Controller of Estate Duty, Kakinada, initiated proceedings under the Act. By his final order dated November 27, 1970, the third respondent assessed the principal value of the share of the petitioner's father in the Hindu undivided family at Rs. 8,95,199. Half of the said value was taken as the interest of the petitioner's father at the time of his death which was deemed to have passed on to the petitioner on the death of his father. The petitioner paid about Rs. 1,05,000 and odd as against the net demand of Rs. 2,50,613, Dissatisfied with that order of the third respondent, he filed an appeal before the second respondent, the Appellate Controller of Estate Duty, Hyderabad, and it is stated that the appeal is still pending.
(3.) IN this writ petition which was filed during the pendency of the appeal the validity of Section 34(1)(c) of the Act is challenged. Two contentions were raised before us by Sri P. Bibulu Reddy, the learned counsel for the petitioner. It was firstly contended that Sub-section (1) of Section 34 is beyond the competence of Parliament inasmuch as estate duty is levied on the whole estate which formed part of the joint family and in which both the deceased as well as the petitioner had interest as coparceners. Now, entry 87 of List I, Schedule VII, reads as under: "Estate duty in respect of property other than agricultural land." The field of legislation, therefore, is specifically mentioned for the purpose o enacting a low on estate duty by Parliament. The entry merely states that estate duty in respect: of property other than agricultural land is the field over which Parliament would be competent to legislate. The definition of "estate duty", however, is given in Article 366(9) and it reads : "'Estate duty' means a duty to be assessed on or by reference to the principal value, ascertained in accordance with such rules as may be prescribed by or under laws made by Parliament or the legislature of a State relating to the duty, of all property passing upon death or deemed, under the provisions of the said laws, so to pass." ;

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