CONTROLLER OF ESTATE DUTY Vs. PAVAYAMMAL

JUDGEMENT

(1.) THIS is a reference under the provisions of the Estate Duty Act, 1953, and the question of law referred at the instance of the Revenue reads as under :

(2.) ONE G. Selvarajan died on June 2, 1974, and the accountable person of the deceased is one Pavayammal. The accountable person filed the accounts of the estate originally on July 24, 1975. The Assistant Controller of Estate Duty completed the assessment on February 20, 1976, determining the principal value of the estate at Rs. 1,48,238. In January, 1981, the accountable person, long after the completion of the assessment, filed a revised account of the estate admitting an enhanced value of the estate at Rs. 1,59,773. The accountable person showed a sum of Rs. 92,698 in the revised statement as the amount due to the legal heirs of the deceased under the terms of the group insurance scheme and claimed the same as exempt, relying on the decision of this court in the case of CED v. Estate of Late R. Ramanujam [1977] 108 ITR 273. The Assistant Controller of Estate Duty completed the assessment on February 12, 1981, determining the principal value of the estate at Rs. 2,52,472 but he declined to grant exemption of the money due from the group insurance on the ground that the decision of this court in Late R. Ramanujam's case [1977] 108 ITR 273, has not become final as an appeal was pending before the apex court. The accountable person challenged the order of the Assistant Controller of Estate Duty before the Appellate Controller and it was urged on behalf of the accountable person that the reassessment was not valid as no notice under Section 59 of the Estate Duty Act, 1953, was served. The Appellate Controller cancelled the reassessment on the ground that the initiation of proceedings beyond the time limit prescribed under Section 73A(b) of the Estate Duty Act was not valid. The Revenue preferred an appeal before the Tribunal and contended that the provisions of Section 73A would apply only for initiation of proceedings by the Revenue authorities and not to the accounts filed voluntarily by the accountable person. The Tribunal rejected the contention that in view of the bar imposed under Section 73A(b) of the Estate Duty Act, the reassessment made by the Assistant Controller of Estate Duty was not valid in law. The Appellate Tribunal also rejected the contention that the provisions of Section 61 of the Estate Duty Act would apply, as the provisions of Section 61 would apply only to rectification of mistakes and no notice under Section 61 was issued by the Assistant Controller. The Tribunal, therefore, held that neither the provisions of Section 59 nor the provisions of Section 61 were applicable and the reassessment made was held to be not valid. The Revenue has challenged the order of the Appellate Tribunal and the question of law set out above has been referred for our opinion.