1987 (1) TMI 154 - AT - Wealth-tax

Summary

Issues:
1. Whether the value of shares in specific properties should be excluded from the net wealth of the estate.
2. Interpretation of the deceased's Will regarding the distribution of properties among grandsons.
3. Application of section 19A(6) of the Wealth Tax Act.

Analysis:
1. The Revenue contested the exclusion of the value of shares in properties at Kirti Nagar and Feroz Shah Road from the net wealth of the deceased's estate. The Will of the deceased clearly stated the properties were to devolve on six grandsons. The Wealth Tax Officer (WTO) added the value, citing non-distribution among grandsons by the valuation date. However, the Appellate Commissioner (AAC) deleted the value, noting the legatees were assessed post-death, fulfilling s. 19A(6) conditions.

2. The deceased's Will unambiguously bequeathed the properties to her grandsons. The Revenue argued non-distribution until 1981 justified inclusion in the estate. The counsel for the respondent emphasized the immediate devolution as per the Will and the assessment of grandsons, supporting the AAC's decision to exclude the property value.

3. Section 19A(6) of the Wealth Tax Act applies to undistributed estate assets. Assets distributed to legatees before the valuation date are excluded but included in the legatee's net wealth. The Tribunal found the AAC correctly vacated the addition, as the Will's provisions dictated immediate devolution to the grandsons, irrespective of mutation status. The Tribunal rejected the Revenue's appeal and dismissed the cross objection.

This detailed analysis highlights the key aspects of the judgment, including the interpretation of the deceased's Will, application of relevant legal provisions, and the reasoning behind the Tribunal's decision to uphold the AAC's order.