Provisions of section 33(1)(n) of the Estate Duty Act, 1953. - Income Tax - 443/CBDT

INSTRUCTION NO. 443/CBDT Dated: August 8, 1972 Section(s) Referred: 33(1)(n) Statute: Estate Duty Act Attention is invited to the provisions of section 33(1)(n) of the Estate Duty Act, 1953. A question had arisen whether the term "house", which has not been defined in the Act, would include the land etc appurtenant to the building used as residence. The Board have examined the issue and are advised that the intention of the Legislature apparently was to exempt from Estate Duty dwelling house, used by the deceased for his residence, upto a particular value. It would not be giving effect to this intention if a small strip of land separating distinct from the adjoining street or road is treated as something distinct from the house and the value of it is included in the value of the property passing on death. The Municipal bye-laws some-time require that a certain portion of the land is also to be kept vacant. Moreover, a certain portion of the vacant land, used for parking vehicles or for a garden may be reasonably necessary for the proper use or enjoyment of the dwelling house. In all such cases it would be only correct to treat them as part of the house itself. 2. The meaning of the term 'house' has been considered in various judicial decisions. The House of Lords in the case of Grant v. Langstion (1900 A.C. 383), had observed: "Accordingly, the word "house" has no common or ordinary meaning so fixed and definite that by the mere use of the word you can determine in what sense the Legislature has used it" The Calcutta High Court in the case of Khirode Chandra Ghoshal v. Saroda Prosad Mitra, (7 Indian Cases, 436), had also observed: "The rule deduced from these cases, is that the term "house" embraces. not merely the structure or building, but includes also adjacent building, cartilage, garden, courtyard, orchard and all that is necessary for the convenient occupation of the house, but not that which is only for the personal use and convenience of the occupier. As was observed by Turner, L.J., in Steele v. Midland Railway Company, the test to be applied, is, what is necessary for the convenient use and occupation of the house, whoever may chance to occupy it, and not, what will be necessary for the personal convenience and enjoyment of a gentleman of fortune if the takes the house, or a gentleman without fortune if he chooses to become the tenant; in other words as wood V.C. put it in Governors of St. Thomes Hospital v. Charging Cross Railway Company...., the term "house" comprises all the would pass by a grant of the house, that is, only the cartilage but all that is necessary to the enjoyment of the house as distinguished from what is subsidiary to personal use and enjoyment of a particular occupier" 3. In view of the above, it would be difficult to say that the land which is appurtenant to the house and which is reasonably necessary for its enjoyment, should not be treated as part of the house for calculating exemption from the estate duty. What is the land which reasonably necessary or is appurtenant, is primarily a question of fact to be decided by the appropriate authority. While considering exemption u/s 33(1)(n) of the Estate Duty Act, the Assistant Controllers should take the facts and circumstances of the case into account and decide how much of the land could be said to be appurtenant to the house for the proper use and enjoyment thereof and how much should be brought to tax as being outside the purview of the said clause. 4. The position in regard to the Wealth-tax Act is almost similar to that in the Estate Duty Act. The Board desire that these instructions may also be kept in view for deciding similar issues for the purposes of wealth-tax assessments. These instructions may please be brought to the notice of all the assessing officers in your charge.