MARY CHERIAN DECD Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) THE applicant is the accountable person in this reference application under Section 64(1) of the Estate Duty Act, 1953, and his claim is that the deceased, his wife, the late Dr. (Mrs.) Mary Cherian, had a domicile in Bahrain and the question of domicile problem after her death on October 16, 1981, at London arose. In this connection, the following three questions expect our answer :

(2.) UNDISPUTEDLY, the entire claim with regard to the domicile in Bahrain is based on the contents of a letter dated September 16, 1979, addressed by the wife to her husband-who is the accountable person.

(3.) THE further travel of the proceedings before the first appellate authority--Appellate Assistant Commissioner of Income-tax--reversed the said decision. THE said authority considered the provisions of Section 21 of the Estate Duty Act with regard to the territorial limitations on the property liable to duty and has observed on the basis of the situation that if the deceased was domiciled in India, the duty would be payable on the immovable and movable property in India and movable property outside India, He also considered that if the deceased was not domiciled in India, even then the situation would not be different, because the immovable property outside India is not liable to estate duty in any case, Even in spite of the above situation, that it would be only movable property outside India that could come under consideration for levy of estate duty and also in view of the position that immovable property outside India would not be liable to estate duty in either of the situations, the appellate authority thereafter took into consideration the letter dated September 16, 1979, and observed that the letter in question was written by the deceased from Bahrain to her husband and it is clear that she decided to continue to stay in Bahrain and spend the rest of her life there. On the basis of the conclusion with regard to the contents of the letter, the appellate authority proceeded to consider the statutory provisions of Section 15 of the Indian Succession Act with regard to the legal situation that the domicile of a married woman follows that of her husband, holding that the said provision of the Indian Succession Act cannot override the charging section, viz., Section 5 of the Estate Duty Act, 1953. THE first appellate authority then considered the question of non-resident (external) account maintained by the deceased in various banks, though located in India. THE authority considered the position of the rules--N. R. E. account rules--framed by the Central Government in 1970. He considered that the said rules are framed much after the statutory enactment of the Estate Duty Act, 1953. He observed that the accounts are freely transferable outside India also because the said rules specifically state that only a person resident outside India may open and maintain an account with an authorised dealer to be called N. R. E. account,