BALAN S Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) THIS reference arose out of the estate duty proceedings consequent on the demise of R. M. Suadaram on May 14, 1960. The deceased was a member of the Indian Civil Service. There were certain special regulations relating to the provident fund of the non-European members thereof. The said non-European members of the Indian Civil Service had to subscribe either to the Indian Civil Service Family Pension Fund or to the Indian Civil Service (Non-European Members) Provident Fund. The deceased subscribed to the Indian Civil Service (Non-European Members) Provident Fund and at the time of his death the amount, which was to his credit, was Rs. 1,04,794. He had nominated his wife as the person entitled to receive the amount in the event of his death before retirement. Accordingly, the amount was paid to her.

(2.) THE Assistant Controller of Estate Duty brought this amount to tax under Section 15 of the Estate Duty Act on his death. THE Appellate Controller confirmed the assessment. In the appeal to the Appellate Tribunal it was contended that the amount did not form part of the estate of the deceased, since it was payable to the nominee direct and that the deceased had no disposable right over the amount. THE restriction in the matter of nomination being confined to the members of the family of the subscriber was relied on in this context. THE further submission was that the beneficiary had a vested right in the fund and that the amount did not form part of the estate of the deceased. Several decisions were relied on before the Tribunal. After considering all of them, the Tribunal also confirmed the assessment.

(3.) IN Appendix A to the Rules, forms of nomination are provided. IN the case of a person who has a family there are two forms. The first form is for nomination of only one person thereof and the second of more than one person thereof. IN the first case the nomination, so far as it is relevant, runs as follows :