CONTROLLER OF ESTATE DUTY Vs. RAGHAVA IYENGAR R

JUDGEMENT

(1.) IN this reference under s. 64(1) of the E.D. Act, 1953, at the instance of the Controller of Estate Duty, Madras,, the following question has been referred for the opinion of this court :

(2.) THE factual backdrop giving rise to this question may now be noticed. One Desika Iyengar (deceased) had two brothers, Krishnaswamy Iyengar and Raghunatha Iyengar. Raghunath Iyengar died in 1946 leaving behind him two sons. Desika Iyengar was employed in the (Central) March 7, 1956, Desika Iyengar (deceased), his brother, Krishnaswamy Iyengar, and his nephews, sons of Raghunatha Iyengar, divided their joint family properties under a deed and the properties set out in the A Schedule thereto were allotted to the share of Desika Iyengar. On March 30, 1967, Deskia Iyengar executed a will under which provision was made with reference to all his properties, movable and immovable. THEreunder, he desired that all his properties should be taken by his wife, Lakshmi Ammal alias Thangammal, to be enjoyed by her for her lifetime without powers of alienation and that on her death, the properties should be taken by Raghava Iyengar, one of the sons of Raghunatha Iyengar, who was also described as "Abhimana Putran". On the same day, Lakshmi Ammal alias Thangammal, wife of Desika Iyengar, in turn, executed a will in respect of properties. THErein, she had provided that after her death, her husband should enjoy the income from the properties without powers of alienation and that the properties set out in A Schedule to that will should be taken by Raghava Iyengar after the death of her husband and that the properties detailed in Schedules B, C, and D to the will should be taken after her death by Chembaka Lakshmi Ammal, Vasudeva Iyengar and Subramania Iyer respectively absolutely. Lakshmi Ammal alias Thangammal died on December 6, 1967. On April 10, 1968, her husband, Desika Iyengar, executed a deed of release purporting to relinquish his interest in all the properties under the will of his wife, Lakshmi Ammal alias Thangammal. Desika Iyengar died on November 17, 1968. Reghava Iyengar filed an estate duty account disclosing all the assets of the deceased, Desika Iyengar. In the course of the assessment proceedings, Raghava Iyengar contended that Desika Iyengar had adopted him as far back as 1922, that the properties belonged to the HUF comprising of the deceased, Desika Iyengar, his wife and himself of which the deceased, Desika Iyengar, was the karta and that the deceased would have been entitled only to a half share which could be deemed to have passed on his death under s. 7 of the E.D. Act. Consistent with this, a revised account was also filed by the accountable person.

(3.) IN the will executed by Lakshmi Ammal alias Thangammal, in the first portion thereof, the testatrix had no doubt stated that her husband, Desika Iyengar, should become entitled to enjoy the income from all her properties for his lifetime. Normally, this provision can be understood as being applicable to B, C and D Schedules also because admittedly all those properties also belonged to the testatrix. But the further provisions in the will make it clear that that was not the intention of the testatrix. With reference to the A Schedule, the testatrix had provided that her Abhimana Putran, Raghava Iyengar, the accountable person, should perform the obsequies not only for the testatrix but also for her husband, Desika Iyengar, and take the A Schedule properties. Similarly, with reference to B, C and D Schedule properties, the will provides that the respective legatees should absolutely take those schedule properties after the lifetime of the testatrix. IN the provision relating to the B, C and D Schedules, there is no direction that those bequests will take effect after the lifetime of the husband of the testatrix, namely, Desika Iyengar. The absence of such a provision clearly indicates that though by the earlier clause in the will the testatrix had desired that her husband should become entitled to the income from all the properties and also enjoy such income for his lifetime without powers of alienation, yet, by the subsequent bequest relating to B, C and D schedules the right given by the earlier clause in the will had not only been taken away, but rights of other legates inconsistent with the right of the husband of the testatrix in those properties had been conferred on the legatees even during the lifetime of the husband of the testatrix. IN other words, the bequest to the husband of the income from all the properties including B, C and D Schedule properties to be enjoyed by him during his lifetime without powers of alienation and the bequests in favour of other legatees with reference to B, C and D Schedules to taken effect immediately after the death of the testatrix cannot stand together and are indeed irreconcilable. IN such a situation, in accordance with the principle laid down in s. 88 of the INdian Succession Act, 1952 we hold that the earlier clause in the will of the testatrix by which her husband was given a right to enjoy the income from all the properties during his lifetime without powers of alienation cannot be extended to B, C and D Schedule properties, as with reference to those properties, the testatrix had provided that the other legatees should become entitled to those properties absolutely and on her death. To hold that the husband of the testatrix had a right of enjoying the income from B, C and D Schedules properties also during his lifetime without powers of alienation would be to ignore the subsequent clauses in the will providing specifically that the other legatees, Chembaka Lakshmi Ammal, Raghunatha and Subramania Iyer, will be entitled to those schedule of properties absolutely and no the death of the testatrix. We are satisfied, on a construction of the terms of the will as a whole, that the husband of the testatrix Desika Iyengar, did not acquire any right or interest in the B, C and D Schedule properties under the will of his wife, Lakshmi Ammal alias Thangammal. We, therefore hold that the Tribunal was quite correct in its conclusion. Accordingly, we answer the question referred to us in the negative and against the Revenue. The accountable person will be entitled to the costs of this reference. Counsel's fee Rs. 500.