1998 (6) TMI 45 - HC - Income Tax

Summary

Issues Involved:
1. Applicability of the Estate Duty Act, 1953, to the estate of a person presumed dead under Section 108 of the Evidence Act.
2. Jurisdiction of the Assistant Controller of Estate Duty to initiate proceedings based on the presumption of death.
3. Determination of the exact date of death under Section 108 of the Evidence Act.
4. Validity of the estate duty assessment proceedings initiated before the Act was repealed for deaths occurring after a certain date.

Issue-wise Detailed Analysis:

1. Applicability of the Estate Duty Act, 1953:
The primary issue was whether the Estate Duty Act, 1953, applied to the estate of P. V. Gajapathi Raju, who was presumed dead under Section 108 of the Evidence Act. The petitioner contended that since the court presumed Gajapathi Raju dead on January 30, 1987, the Act, which was repealed for deaths occurring after March 16, 1985, was inapplicable. However, the court held that Section 5 of the Estate Duty Act, the charging section, applies to both natural and civil deaths, including those presumed under Section 108 of the Evidence Act. The court concluded that the presumption of civil death amounts to physical death, thus invoking the provisions of the Estate Duty Act.

2. Jurisdiction of the Assistant Controller of Estate Duty:
The court examined whether the Assistant Controller had jurisdiction to initiate estate duty proceedings based on the presumption of death. The petitioner argued that there was no presumption as to the exact date of death under Section 108 of the Evidence Act. The court acknowledged that while Section 108 presumes the fact of death after seven years, it does not presume the exact date of death. However, the court held that the Assistant Controller could draw a presumption of death and determine the date of death based on available evidence, thereby having the jurisdiction to initiate proceedings.

3. Determination of the Exact Date of Death:
The court addressed the issue of determining the exact date of death under Section 108 of the Evidence Act. It was established that the presumption of death arises after seven years of disappearance, but the exact time of death must be proved by evidence. The court cited multiple precedents, including the Supreme Court's decision in N. Jayalakshmi Ammal v. R. Gopala Pathar, which held that there is no presumption as to the date of death even after seven years. The burden of proof lies on the person claiming a right based on the fact of death. The court concluded that the Assistant Controller could determine the date of death based on the materials and evidence available.

4. Validity of the Estate Duty Assessment Proceedings:
The petitioner argued that since the Estate Duty Act was repealed for deaths occurring after March 16, 1985, the proceedings were invalid. The court held that the Assistant Controller had initiated proceedings before the Act's repeal, and the presumption of death allowed him to continue the assessment. The court emphasized that the estate duty proceedings are quasi-judicial, and the Assistant Controller could draw necessary presumptions and determine the date of death unless rebutted by the petitioner with cogent evidence. The court also noted that the order of the High Court granting letters of administration did not conclusively establish the date of death as January 30, 1987.

Conclusion:
The court dismissed the writ petition, holding that the Assistant Controller of Estate Duty had the jurisdiction to initiate and continue estate duty assessment proceedings based on the presumption of death under Section 108 of the Evidence Act. The petitioner was given an opportunity to present evidence to rebut the presumption and establish the exact date of death. If the petitioner failed to do so, the Assistant Controller could proceed with the assessment based on the presumption of death and determine the date of death accordingly.