2002 (7) TMI 6 - HC - Income Tax

Estate Duty Act, 1953 - 1. Whether the Tribunal is right in holding that a deduction of Rs. 1,50,000 in marriage expenses of three unmarried daughters be allowed out of the property of the deceased? - 2. Whether the Tribunal is right in holding that while giving exemption under section 33(1)(n) in respect of house property included in the value of the estate one has to assume as if the house happened to come to the share of the deceased on a fictional partition of the Hindu undivided family before the date of the death and in allowing exemption of Rs. 1,00,000 instead of to the extent of the share of the deceased the house property? - Our answer to both the questions is in the affirmative, that is in favour of the accountable person and against the Revenue.

Summary

Issues:
1. Deduction of marriage expenses of unmarried daughters from deceased's property.
2. Exemption under section 33(1)(n) in respect of house property included in the estate.

Issue 1: Deduction of Marriage Expenses:
The deceased's estate included individual estate and share from the Hindu undivided family. The accountable person claimed Rs. 1,50,000 for marriage expenses of three unmarried daughters. The first Assistant Controller of Estate Duty rejected the claim, stating it was not a charge on the deceased's share in the family property. The Appellate Controller accepted the claim, directing the deduction from the family estate. The Tribunal upheld this decision, leading to the Revenue's appeal. The court examined various precedents and held that daughters' right to marriage expenses from ancestral property is enforceable, allowing the deduction. The court declined to remand for further inquiry due to the repealed Estate Duty Act, affirming the deduction.

Issue 2: Exemption under Section 33(1)(n):
The Revenue disputed the exemption granted under section 33(1)(n) for the deceased's share in a self-occupied property. The Revenue argued that the exemption should be limited to the deceased's share in the family property. The Tribunal, following a Full Bench decision, allowed the full exemption of Rs. 1,00,000 based on the assumption that the property could have gone entirely to the deceased in a notional partition. The court agreed with the Tribunal, citing the factual background of the family's assets and upheld the exemption. The court distinguished the Supreme Court's decision in a different context, emphasizing the specific circumstances of the present case. Consequently, the court ruled in favor of the accountable person, affirming the exemption.

This judgment clarifies the legal principles regarding deductions for marriage expenses from ancestral property and exemptions under section 33(1)(n) in the context of deceased's estate. The court's detailed analysis of precedents and factual considerations provides a comprehensive understanding of the issues involved.