BHOOMIAMMA K Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) BOTH these reference arise out of the estate duty proceedings consequent on the death of K. Gururajachar who died on February 9, 1969. The Tribunal, Bangalore Bench, has referred, under the E.D. Act, 1953 (hereinafter referred to as "the Act"), the following five questions :

(2.) QUESTIONS Nos. (1) to (4) set out above are referred under s. 64(1) and question No. (5) is referred pursuant to an order made under s. 64(2). T.R.C. No. 1/74 relates to the first four questions and T.R.C. No. 132/75 relates to the fifth question.

(3.) THE second question arises out of the contention raised on behalf of the accountable persons that the valuation of the annuity deposits at Rs. 47,047 made by the Appellate Contr. without taking into consideration the were realised from time to time, was wrong. It is urgued before us that since the net amount which would come into the hands of the accountable persons after paying the income-tax which they were bound to pay under law was far less than Rs. 47,047, the authorities concerned should have fixed the value of the annuity deposits at a lower figure. This argument is not based on any express provision of the Act nor is it supported by any precedent. It is urged that the said contention is based on general principles of valuation of an amount which is likely to be received in future. We find it difficult to agree with the above submission. If the above contention is accepted, then it would lead to the incongruous result of the same amount of annuity deposits being valued differently in the case of different accountable persons on the basis of the income-tax they are likely to pay. In the case of those who pay higher rate of income-tax the value of the same amount of annuity deposit will be less than its value in the hands of those who pay lower rate of income-tax or no income-tax. We are of the view that the income-tax which the accountable person is likely to pay has no relevance to the valuation of the annuity depostis at the time of the death of the deceased.