RAMKUNWAR BAI Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) This is a reference under Section 64 of the E.D. Act made by the Appellate Tribunal, Indore.

(2.) The facts giving rise to this reference are that one Mayachandsa died on June 4, 1957. His widow, the accountable person, Smt. Ramkunwar Bai, is the party to these proceedings. The Asst. Controller of Estate Duty determined the principal value of the estate on the date of death of the deceased at Rs, 5,65,116. The Asst. Controller held that the entire coparcenary interest of the deceased in the coparcenary property passed on his death. It also held that an amount of Rs. 3,50,000 which was settled by the deceased under a trust of which the deceased himself was a managing trustee and over which the deceased had an absolute power of disposal also passed on the death of the deceased. The accountable person, i.e., Smt. Ramkunwar Bai went up in appeal to the Appellate Controller of Estate Duty and before the appellate authority two questions were raised; that the deceased and his wife, Ramkunwar Bai, constituted a joint Hindu family and, therefore, the deceased only had half interest in the assets of the HUF. Therefore, only half of the property of the coparcenary would be deemed to have passed on the death of the deceased. Another question raised was that as by creating a trust the deceased had settled the amount of Rs. 3,50,000, that amount could not be said to have passed on his death to Smt. Ramkunwar Bai. The Appellate Controller rejected the first contention. As regards the second the appellate authority held that out of Rs. 3,50,000 certain items were disbursed during the lifetime of the deceased, Mayachandsa, himself. But an amount of Rs. 82,000 made up of three items, Rs. 25,000, Rs. 20,000 and Rs. 37,000, remained with the deceased in his control and, therefore, this amount of Rs. 82,000 is the amount which passed on his death. Smt. Ramkunwar Bai thereafter went up in appeal before the Appellate Tribunal and the Appellate Tribunal confirmed the findings of the Appellate Controller and the appeal was dismissed. Smt. Ramkunwar Bai thereafter submitted an application under Section 64 of the E D. Act for making a reference and the Tribunal has submitted this statement of case and referred the following two questions to this court :

(3.) As regards the first question, i.e., the amount of Rs. 82,000 out of the amount of Rs. 3,50,000 which was entrusted to a trust of which the deceased himself was the managing trustee, it is not disputed that this amount of Rs. 82,000 remained in the custody and care of the deceased himself and it was he who was utilising this amount.