DEVAKI AMMAL V Vs. ASSISTANT CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) THE petitioner is the widow of one late P. S. Venkatesa Pillai, hereinafter called the deceased, who died intestate on December 2, 1966, leaving behind him his widow, a minor son, Mohanasundaram, and an unmarried daughter, Gajabai. He was the karta of a Hindu undivided family consisting of himself and his minor son. THE family possessed immovable properties in Madras and agricultural lands in Peruganavoor village, Penned Taluk, and movable properties in the form of cash in current account, recurring deposit, compulsory deposit, etc. THE deceased as a coparcener would have had a half share in the family properties if a partition had taken place during his lifetime. But, no such partition took place.

(2.) THE petitioner as an accountable person submitted a return of estate duty declaring the principal value of the share of the deceased in the joint family properties at Rs. 74,884. THE Assistant Controller of Estate Duty, the respondent herein, however, determined the value of the property passing on the death of the deceased at Rs. 1,24,859 as against the value returned, after adjusting the funeral and other expenses which are permissible deductions under the Act. He, however, added a sum of Rs. 1,26,067 being the lineal descendant's share, namely, the share of the minor son in the family properties to the value of the share of the deceased in accordance with the provisions of Section 34(1)(c) of the Estate Duty Act, 1953, hereinafter called the Act, and determined the principal value of the estate at Rs. 2,50,926. THE estate duty payable on the said principal value was fixed at Rs. 19,638.90. After allowing Rs. 9,866.72 as rebate on lineal descendant's share the estate duty payable was arrived at Rs. 9,772.18. Aggrieved against such aggregation of the lineal descendant's share with that of the deceased, the petitioner has come forward with this writ petition seeking to quash the said assessment order.

(3.) SECTION 34(1)(c) directs that if the property passing on death consists of a coparcenary interest in the joint family property of a Hindu family governed by Mitakshara, Marumakkattayam or Aliyasanthana law, the interests in the joint family property of all his lineal descendants shall be aggregated with the coparcenary interest of the deceased so as to form one estate, and that the estate duty shall be levied thereon at the rate or rates applicable in respect of the principal value of such estate. Sub-section (2) provides that where any such estate as is referred to in Sub-section (1) includes any property exempt from estate duty, the estate duty leviable on the property not so exempt shall be an amount bearing to the total amount of duty which would have been payable on the whole estate had no part of it been so exempt, the same proportion as the value of the property not so exempt bears to the value of the whole estate. The Explanation to this section defines what is " property exempt from estate duty ". Under that Explanation interest of all coparceners other than the deceased in the joint family property of a Hindu family governed by the Mitakshara, Marumakkattayam or Aliyasanthana law has to be treated as property exempt from estate duty.