GEORGE DA COSTA Vs. CONTROLLER OF ESTATE DUTY MYSORE

JUDGEMENT

(1.) This appeal is brought, by special leave, from the judgment of the. Mysore High Court's dated November 17, 1964 in Tax Referred Case No. 1 of 1964.

(2.) The property in question is house No. 34 Mahatma Gandhi Road, Bangalore. It had been purchased by the appellant's father Dr. C. F. Da Costa (hereinafter called the 'deceased') in the joint names of himself and his wife on February 14, 1940. They made a gift of the house to their two sons on October 29, 1954. The document recites that the donees had accepted the gift and they had been put in possession. But the parents continued to be in possession of the house though the municipal tax was paid thereafter in the names of the sons. The deceased died on September 30, 1959 more than 4 years after the gift. The appellant, the accountable person, then filed a return showing the value of the estate left by his father at Rs. 93,750 excluding the value of the house No. 34, Mahatma Gandhi Road, Bangalore. The Assistant Controller of Estate Duty, however, included the sum of Rs. 1,50,000 as the value thereof and determined the aggregate value of the estate at Rs. 2,57,249 and assessed the estate duty payable at Rs. 15,751.54 P. by his order, dated November 30, 1959. The appellant thereupon preferred an appeal to the Central Board of Revenue (hereinafter referred to as the 'Board') which dismissed the appeal and affirmed the view taken by the Assistant Controller of Estate Duty. At the instance of the appellant the Board referred the following question of law for the determination of the High Court:

(3.) Under S. 5 of the Estate Duty Act, 1953 (Act No. 34 of 1953) (hereinafter called the 'Act'), estate duty is payable on the principal value of the estate of every person dying after the commencement of the Act. Section 2 (16) of the Act defines the expression "property passing on death'' and is to the following effect: