C.S.P. Singh, J. - (1.) THE Central Board of Direct Taxes, New Delhi, has under Section 64(1) of the Estate Duty Act, 1953, referred the following question for our opinion : "Whether, on the facts and in the circumstances of the case, the Board were justified in holding that all the properties (other than properties of the value of Rs. 36,000 and the agricultural lands in Kama! District, Punjab) were correctly included in the estate duty assessment of the deceased as property which belonged to the deceased in his individual capacity?"
(2.) THIS reference relates to the assessment of the estate of the deceased, S. Tahl Singh. The items of properties left by the deceased consisted of various bank accounts either in the name of the deceased or in the joint names of the deceased with his wife or his son, some agricultural land in District Karnal, Punjab, plots of land at Delhi and Dehradun and verified claims for properties left in Pakistan. The accountable person submitted a return voluntarily and claimed that the deceased had only one-third share in the various items of property, and that the accountable person and the widow held the remaining two-thirds share inasmuch as the property belonged to the Hindu undivided family. In support of his claim, the accountable person filed the following evidence: (1) An affidavit asserting that the deceased bad inherited three Murabas of agricultural land in district Gujranwala and also some house property from his father, Lala Gopal Das. These properties yielded income and out of the income from them, the deceased had acquired certain assets when he migrated from Pakistan. (b) The arbitration award dated June 14, 1935, relating to partition of certain immovable properties between the various members of the family to which the deceased belonged. (c) Copy of the application filed by the deceased before the Additional Deputy Commissioner, Karnal, regarding allotment of certain agricultural lands. (d) Copy of another application filed by the deceased before the Additional Deputy Commissioner, Karnal, on the same subject. (e) Oral testimony of one Dr. Mathura Das of 20, Rajpur Road, Delhi. The Controller of Estate Duty, U. P., however, did not accept the contention of the accountable person and held that the properties belonged exclusively to the deceased." Referring to the arbitration award he held that under the award the deceased had obtained only one shop and half share in another shop at the time of the partition, and taking in view the fact that the deceased had left behind a bank balance of over rupees two lakhs and other items of property, he held that the income from the aforesaid properties could not form the nucleus for the acquisition of such a vast estate. In respect of the statement by Dr. Mathura Das and the application filed by the deceased for allotment of land, he held that from the application and the statement of Dr. Mathura Das, it was clear that the land which was said to be owned by the deceased in Pakistan belonged to the bigger coparcenary up to the date of migration from Pakistan, and no partition had taken place. He held that the income, if any, derived from this land was of the composite coparcenary and did not belong exclusively to the deceased. He also took into account the fact that Dr. Mathura Das had stated that the deceased was an engineer in the P. W. D. and as such held that it was probable that the deceased might have earned sufficient amounts of money and got adequate amounts from his provident fund and pension at the time of his retirement, and this money in all probability provided the funds required for the acquisition of the present estate. Reference was also made to the order made by the claims officer in respect of certain verified claims of the accountable person which went to show that the properties covered by these claims had been built or purchased by the deceased himself. Reliance was also placed upon the fact that the Regional Settlement Commissioner, Delhi, fixed the gross compensation in respect of the properties left behind in Pakistan at Rs. 34,394 in accordance with Appendix VIII of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955, which was not applicable to the calculation of compensation for properties of joint families. The accountable person, thereafter, filed an appeal before the Central Board of Revenue. The Board of Revenue held that there being no definite evidence regarding the extent of agricultural land owned by the family in Pakistan, it could not be said that the estate acquired by the deceased was from the joint family fund. It also took the view that, inasmuch as the deceased was holding a fairly lucrative post in the Government, the estate left behind by the deceased could be acquired from the income of the deceased person from his service. It, however, took the view that the joint family owned some agricultural land in Pakistan in lieu of which they were granted agricultural lands in Karnal of the value of Rs. 9,000 and as such held that a part of the estate belongs to the Hindu undivided family and as such excluded, an amount of Rs. 36,000 from the value taken by the Assistant Controller.
(3.) COUNSEL for the applicant has contended that the Board having found that there was a joint family nucleus for acquisition of some property it erred in not allowing the claim in its entirety. Nextly, it has been contended that even if it be assumed that the properties belonged to the deceased, the deceased had thrown these properties in the common hotchpot and as a result individual properties of the deceased blended with the joint properties held by the Hindu undivided family. Counsel for the accountable person has contended that the Board having found that there was nucleus of Hindu undivided family funds for acquisition of some of the properties, a presumption arose that the entire estate belonged to the Hindu undivided family as the deceased died in a state of jointness.;