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Issues Involved:
1. Determination of goodwill of the transport company under section 17 of the Estate Duty Act. 2. Justification of disallowing excess remuneration paid to the deceased. 3. Correct estate duty payable by the accountable person. Issue-wise Detailed Analysis: 1. Determination of Goodwill of the Transport Company: The primary issue was to ascertain whether the transport company, M/s. Coimbatore Salem Transport Pvt. Ltd., had acquired any goodwill and, if so, the correct amount to be considered under section 17(2) of the Estate Duty Act. The accountable person argued that the company did not acquire any goodwill as it provided common type services and did not deal in specialized goods. They cited several cases, including *Seethalakshmi Ammal v. CED* and *A.K.D. Dharmaraja v. CED*, to support their contention that no amount should be taken towards the goodwill of the company. Additionally, they argued that the impending nationalization of private buses in Tamil Nadu would have a depressing effect on the goodwill of the company. The Tribunal, however, rejected these arguments, stating that the transport business could acquire goodwill based on the quality of service, organizational skill, and the standing of the business. The Tribunal noted that the nationalization ordinance was promulgated after the death of the deceased, and thus, it was unlikely to have influenced the goodwill at the time of death. The Assistant Controller had initially computed the goodwill at Rs. 12,05,004, which was reduced to Rs. 8,03,336 by the Appellate Controller. The Tribunal upheld this reduction, considering it sufficient to account for any impact of the nationalization rumors. 2. Justification of Disallowing Excess Remuneration: The second issue was whether there was any justification to disallow Rs. 12,000 per year from the remuneration paid to the deceased while computing the benefits accruing to him. The deceased was paid Rs. 24,000 per year for the last three years of his life. The Assistant Controller and the Appellate Controller had disallowed Rs. 12,000 per year as excessive remuneration. The Tribunal found this disallowance unjustified. It noted that no part of the remuneration was disallowed under section 40A(2) of the Income-tax Act during the company's assessment for the relevant years. The Tribunal also disagreed with the Appellate Controller's view that the company was a medium-sized transport company and that the directors' work should be considered part-time. Given the company's operations involving 31 lorries, 7 buses, and 7 cars, the Tribunal concluded that the remuneration of Rs. 24,000 per year was reasonable and should be considered fully. 3. Correct Estate Duty Payable: Based on the findings on the above two points, the Tribunal directed that the correct slice of the assets to be added to the estate of the deceased under section 17 of the Estate Duty Act should be recalculated. The appeal of the accountable person was partly allowed, leading to a reassessment of the estate duty payable. Conclusion: The Tribunal concluded that the transport company had acquired goodwill, which should be considered while determining the estate duty, and upheld the Appellate Controller's valuation of Rs. 8,03,336. It also held that the remuneration paid to the deceased was reasonable and should not be disallowed. Consequently, the correct estate duty payable would be recalculated in light of these findings.
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