SURAJMALL GOUTI Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) This reference arises out of estate duty proceedings in respect of the estate of one Madan Chand Gouti, who died on the 18th March, 1966. The facts found and/or admitted are, inter alia, that during his lifetime the deceased was a partner in the firm of M/s. Chouthmull Joychandlal Gouti (hereinafter referred to as " the firm") having 12.5% interest (1/8th share) therein. One of the assets of the said firm was a jute press named Gouti Jute Press consisting of five godowns held under a lease for 61 years. The business of the firm consisted mainly of letting out the said godowns from which substantial income was earned. The material clauses in the deed of partnership dated the 10th April, 1965, were, inter alia, as follows:

(2.) Surajmull Gouti, the executor appointed by the will of the deceased and as such the accountable person, filed a return in respect of the estate of the deceased declaring the net principal value thereof at Rs. 2,52,249. In the said return, the value of the deceased's share in the said firm was computed as follows: <FRM>JUDGEMENT_182_ITR119_1979Html1.htm</FRM>

(3.) By his letter dated the 1st August, 1967, the Asst. CED called upon the accountable person to explain the difference between the amount of the balance shown to the credit of the deceased in the balance-sheet of the firm and that shown in the return. He also called upon the accountable person to show why the value of the said jute press should not be computed on the basis of the rental income enjoyed by the firm and directed him to furnish the market value of the said jute press at the date of the deceased's death.