1984 (7) TMI 162 - AT - Income Tax

Accounting Year, Assessment Year, Debt Owed, Estate Duty, Net Wealth, Rectification Of Mistakes, Right To Receive

Summary

Issues:
1. Whether the non-inclusion of the life insurance amount received by the assessee in the assessment for the year 1980-81 constitutes a mistake apparent from the record.
2. Whether the excess allowance of estate duty claimed by the assessee for the assessment year 1980-81 is a mistake apparent from the record.
3. Whether the assessee is entitled to claim deduction of estate duty only on a proportionate basis for the assessment year 1981-82.

Analysis:
1. The first issue concerns the non-inclusion of the life insurance amount received by the assessee in the assessment for the year 1980-81. The Appellate Tribunal held that the right to receive the matured amount under the policy accrued to the assessee when his father died, making him the owner of the amount payable under the policy. The Tribunal concluded that the original assessment suffered from an apparent mistake for not including the amount paid under the policy, based on the Andhra Pradesh High Court ruling. The Tribunal upheld the lower authorities' decision and dismissed the appeal on this issue.

2. The second issue revolves around the excess allowance of estate duty claimed by the assessee for the assessment year 1980-81. The Tribunal found that the assessee claimed full deduction of the estate duty amount, but it was later realized that only a proportionate amount should have been allowed. The Tribunal analyzed the provisions of the Estate Duty Act and concluded that the excess payment was not legally recoverable from the assessee. Therefore, the Tribunal held that the excess allowance of estate duty in the original assessment constituted a mistake apparent on record. The appeal was dismissed on this issue.

3. The final issue pertains to the deduction of estate duty claimed by the assessee for the assessment year 1981-82. The Tribunal reiterated its decision from the previous assessment year, stating that the assessee was entitled to claim deduction only on a proportionate basis for the estate duty liability. The Tribunal held that the amount claimed in excess of the proportionate share was not a legitimate deduction for the assessee. Consequently, the Tribunal dismissed the appeal for the assessment year 1981-82 based on the same reasoning applied to the earlier assessment year.