CONTROLLER OF ESTATE DUTY PUNJAB HARYANA J AND K" U P CHANDIGARH AND PATIALA Vs. KAMLAVATI AND SHRI JAI GOPAL MEHRA

JUDGEMENT

(1.) These two appeals by certificate filed by the Controller of Estate Duty are from the Judgments of the Punjab and Haryana High Court. Both the appeals have been heard together as a common question of law is involved in them. It relates to the interpretation and applicability of S. 10 of the Estate Duty Act, 1953, hereinafter called the Act.

(2.) We shall first proceed to state the facts and discuss the law in Civil Appeal 2527 of 1972. Even though the respondent, Smt. Kamlavati, was not represented in this appeal, Mr. S.T. Desai, learned counsel for the appellant, assisted the court very ably and fairly. In the other appeal, being Civil Appeal 2528 of 1972, Shri Jai Gopal Mehra, the respondent, was represented by Mr. Bhagirathi Das. The main judgment of the Full Bench of High Court is in this Civil Appeal, and it has followed the ratio of this decision in the other appeal also. We, however, find it convenient to first discuss the question of law with reference to the facts of Civil Appeal 2527 of 1972.

(3.) Maharaj Mal, the deceased, with whose estate we are concerned in this appeal, was a partner in a partnership firm styled as M/s. Maharaj Mal Hans Raj. Maharaj Mal had a half share in the partnership. The other two partners namely Jailal and Hansraj had each 1/4th share. On the 27th March, 1957 Maharaj Mal made a gift of Rs. 1,00,000/- to his son, Lalit Kumar, and of Rs. 50,000/- to his wife, Kamlavati. In the books of the partnership firm the sums of Rs. 1,50,000/- were debited in the account of Maharaj Mal and credited to the accounts of Lalit Kumar and Kamlavati Rs. 1,00,000/- in the name of Lalit Kumar and Rs. 50,000/- in the name of Kamlavati. Almost simultaneously with effect from 28th March, 1957 as per the instrument of partnership dated the 2nd April, 1957 Lalit Kumar was taken as a partner in the firm of M/s. Maharaj Mal Hans Raj by giving him 1/4th share out of the half share of Maharaj Mal. In other words, with effect from the said date there were four partners in the firm each holding 1/4th share.