ANNAMALAI CHETTIAR G Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) THIS is a reference under Section 64(1) of the Estate Duty Act, 1953. One A. Ar. Annamalai Chettiar died on August 9, 1957 leaving a will dated April 24, 1957, in and by which he bequeathed his estate in favour of his grandsons, who are the accountable persons. They filed a return showing the principal value of the estate that passed on the deceased's death at Rs, 1,57,090, The Assistant Controller, however, fixed the principal value at Rs. 1,81,185. Two items, among others, were in dispute. (1) a sum of Rs. 77,227 outstanding due to the deceased in Burma in the course of his money lending business and (2) includibility, in the principal value of compensation in respect of a part of the lands notified in Burma and taken over. The Revenue has taken the view that since the only restriction in respect of the outstandings was about repatriation of funds, there is no sufficient reason why they should be excluded in computing the principal value of the deceased's estate. As regards the right to receive compensation, the Revenue repelled the contention for the accountable persons that it should be considered as a benefit arising out of the lands. The question in the circumstances which has been referred to us by the Central Board of Direct Taxes is;

(2.) ON the other item, It seems that deceased owned 4,530 acres of agricultural land, of which 656-71 acres were notified under the laws of Burma for being taken over. In respect of this extent of land, a sum of Rs. 2,500, was admittedly payable as advance compensation to the deceased. The Assistant Controller directed that the immovable property, which was not under notification, should be excluded from the computation of the principal value but the extent which was under notification and in respect of which the deceased was entitled to compensation should be included in It. ON that view he directed the accountable persons to inform the officer as to when compensation would be received so that it should be taken into account and the assessment re-opened under Section 62 read with Section 53(4) of the Act. The Central Board of Taxes took a similar view.