CONTROLLER OF ESTATE DUTY Vs. VASANTRAO S DEMPO

JUDGEMENT

(1.) THE deceased had been a member of the society known as Dempo Family Society which was constituted by his forefathers under the Portuguese Law under a decree dated December 16, 1880. The society was reconstituted as per the deed dated February 20, 1930, between Srinivas and his wife, Satiabamabai, on the one hand, and Vitola and his wife, Rocumbai, on the other, each group having 50% share. As per a subsequent deed dated April 22, 1950, the deceased and his wife had jointly gifted half of their shares to their sons, Ventexa and Voicunta who, thereafter, became members of the society along with their parents, all of them having 12 -1/2% share each. The deceased, his wife and their two sons continued as members of the society till its dissolution on May 6, 1967, when all the immovable properties of the society were distributed amongst its members. Soon thereafter, i.e., on May 26, 1967, the deceased passed away.

(2.) THE Assistant Controller of Estate Duty held that the gift jointly made by the deceased and his wife to the extent it related to his share was includible in the principal value of the estate under section 10 of the Estate Duty Act, 1953, as the deceased had continued to enjoy his entire share in the family society till his death. He estimated the value of the said 12 -1/2% share at Rs. 1,75,000 and included the said amount in the dutiable estate of the deceased. The inclusion was confirmed by the Appellate Controller of Estate Duty. The Tribunal, however, deleted the inclusion.

(3.) SHRI Dhanuka, learned counsel for the Revenue, took us through the relevant portions of the deed of gift and the deed of dissolution referred to in the order of the Tribunal at page 18 of the paper book. It was stated that the deceased had made a gift of his 12 -1/2% share in the family society to the donees which share the donees could possess and dispose of in any manner they liked. The deed of dissolution, it was stated, clearly indicated that all the proportions belonging to the family society were enjoyed by all the members till the dissolution of the society and were distributed amongst the members only thereafter. This fact, according to him, conclusively proves that bona fide possession and enjoyment over the gifted property was not assumed by the donees to the exclusion of the deceased and, therefore, the provisions of section 10 of the Estate Duty Act, 1953, were attracted.