THE CONTROLLER OF ESTATE DUTY, A.P II, HYDERABAD AND LATE SRI. M. GANGAPPA A/P SRI. M. RAMANA, YEMMIGANUTUR Vs. THE CONTROLLER OF ESTATE DUTY, A.P. II, HYDERABAD AND LATE SRI. M. GANGAPPA A/P SRI. M. RAMANA, YEMMIGANUTUR

JUDGEMENT

(1.) IN this reference at the instance of the Controller of Estate Duty (CED) under Section 64(1) of the Estate Duty Act, 1953 (the Act, for brevity), the following question is referred for the opinion of this Court.

(2.) THE fact of the matter which is not in serious dispute is as follows. In GIR No. G.212, the Assistant Controller of Estate Duty (ACED), Tirupati, passed an assessment order with reference to the statement of account filed by M. Ramana - accountable person (A.P.) wherein the value of the property passed on the death of M. Gangappa (died on 22.01.1978), the A.P. was directed to pay estate duty of Rs. 2,08,154/ - and a demand was made for Rs. 1,44,494/ - after giving credit to the amount already paid.

(3.) THE Junior Counsel for Income Tax submits that the decision in Controller of Estate Duty v. Mrudula Nareshchandra : (1986) 160 ITR 342 (SC) relied on by the ITAT was only concerned with the issue of valuation of interest of the deceased person in the goodwill and therefore in applying the ratio therein the ITAT went wrong. He would contend that Section 36 of the Act enables the Assistant Controller to determine the principal value according to market price at the time of the deceased's death and therefore the global method of valuation applied to valuation of the assets of the firm is not applicable.