R M SHAHANI Vs. CONTROLLER OF ESTATE DUTY

JUDGEMENT

(1.) THIS is a reference under s. 64 of the ED Act, 1953.

(2.) SHRI M. S. Shahani, whose estate is in question, died on the 12th July, 1956. He was a displaced person from Pakistan, where he had left certain immovable properties concerning which he had filed a claim. That claim had been verified and, under the provisions of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, he was entitled to receive a net compensation of Rs. 72,717. When the return of the estate duty was submitted by the son of the deceased, who is the petitioner before us, this particular claim was included in it. The Assistant CED valued the claim at Rs. 72,717 and assessed duty accordingly. The petitioner appealed to the Central Board of Revenue and he contended there that the compensation claim should have been valued at half its face value, as such claims were being sold in the market at fifty per cent. discount. The Central Board of Revenue found that there was no definite evidence produced to support the contention and, in the absence of evidence to the contrary, the Board held that the compensation claim had been correctly valued since, under the Displaced Persons (Compensation and Rehabilitation) Rules, the claimant was entitled to receive Rs. 72,717. The petitioner then asked for a question of law arising in the case to be referred to this Court, and the Central Board of Revenue decided thereupon to refer the following question :

(3.) IN the course of arguments, reliance was sought to be placed on certain English decisions concerning the valuation of unquoted share or shares which are not ordinarily transferable, but those decisions can be of no assistance in the present case, for a claim to receive a particular amount as compensation under the Displaced Persons (Compensation and Rehabilitation) Act has no great resemblance to the shares of a company, whether transferable or not. The holder of a verified claim under the Displaced Persons (Compensation and Rehabilitation) Act is, by force of law, entitled to receive some property of the exact value of his net compensation, and hence, therefore, the net compensation is determined, as has been done in the present case, and its value, in the absence of evidence to the contrary, would be the face value. It follows that the decision made by the Central Board of Revenue in this case is correct, and the question referred for our decision must be answered in the affirmative and against the petitioner, and I would so order. The petitioner must pay the respondent's costs before us. Counsel's fee Rs. 75.