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TMI Blog1988 (8) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... akf estates. The accountable person Shri Altafur Rahman, eldest son of the deceased filed the return on 18th Aug., 1967 and no other accountable persons had filed return. The Asstt. Controller mentioned that Shri Assadar Ali Barlaskar, brother of the deceased and present Mutawalli was also served with the notice under s. 55 but there was no compliance on the ground that he was not interested in any property left by the deceased. The Asstt. Controller concluded that in the circumstances Shri Assaddar Ali Barlaskar is liable to duty to the extent of the share of the property of the deceased i the Wakf bears to the entire estate of the deceased. 2. The ACED examined the various facts and details of the properties movable and immovable and determined the valuation of such properties for inclusion in the principal estate of the deceased. In addition, the Asstt. Controller considered the value of the interest of the deceased in the Wakf estate. He noted that there were two wakf estate under two different wakf deeds, which details were noted in the assessment order. The Asstt. Controller computed the value of such interest of the deceased in the Wakf estates and gave suitable deductions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e properties as mentioned in the impugned order and directed the Asstt. Controller to modify the assessment accordingly. 5. The accountable person being not satisfied with the order of the Appellate Controller, has brought this appeal before us. It is submitted by the learned counsel for the accountable person that Wakf properties were dedicated and belonging to the Almighty and no part of the properties passed on the death of the deceased who was nothing but the manager of the Wakf properties. It is also the appeal by the accountable person that the deceased was not in a beneficial possession of the Wakf properties excepting a right to receive share from the income of the said properties which cannot be liable to pay estate duty on such income-baring assets either under s. 5 or 6 of the Act. It is submitted that the income receivable by the deceased did not devolve on the death of the deceased, to other beneficiaries and that whatever share of income become payable, the same was by virtue of the Wakf deed and the same was not liable to estate duty. 6. It is submitted by the learned counsel for the accountable person vehemently that the authorities below went wrong in including ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the immovable properties which he had dedicated. He divested himself of every right of ownership etc., over such properties. He directed that he himself should be first Mutwalli of the Wakf for his life time and thereafter his elder son and after him other sons according to seniority in age will be appointed Mutwalli. The directions were also given to collect receipts, incomes etc. from the properties and to incur expenditure for maintenance of such properties and also to contribute to certain religious mattes and also for payment of salary to Mutwalli or to his assistants. It was directed that after that 1/4th of the income would be spent for the improvement of the Tea Estate known as "Rahman Nagar Tea Estate", and 3/4th of the income shall be used by the first Mutwalli for his maintenance during his life time in the way he liked. It was also stipulated that after his death the said 3/4th share will be available for his wife, sons and daughters, according to the Muslim right of inheritance. Specific directions were also given for use of those resources for a limited period of time and thereafter the share would devolve on the descendants as specified in the Wakf deed itself. It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said religion as religious, pious or charitable. A wakf extinguishes the right of the wakf and transfer ownership of God and the mutawalli is the manager of the wakf, but the property does not vest in him as it would in a trustee in the case of an ordinary settlement. 11. Property held by the deceased as a trustee is not chargeable to estate duty as the provisions of s. 22 may be found to be applicable. In this connection, we may refer to the decision in the case of Mahanth Umesh Narain Puri vs. CED (1970) 75 ITR 310 (Pat), in which it was held that the properties of a math which are vested in and managed by a mahanth are In the nature of a private trust to which s. 22 of the Act will be applicable. It was held also that a mahant does not have the powers of disposal over such property of a math and the properties cannot, therefore, be deemed to pass on the death under s. 6. Thus, if in such cases the properties of the math held by the trustee cannot be deemed to have passed on the death of the mahant, similarly it would bee the case of a Matwalli as in the present case, particularly in view of the specific direction in the Wakf deed that Mutwalli to whom certain duties were entr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the father would be entitled to those benefits after meeting certain expenses specified, out of the income or receipts of the different wakf properties. Of course, there is no direction or specific stipulation that on the death of any beneficiary the share of that deceased beneficiary would stand dissolved or being distributed to other existing beneficiaries. In the circumstances, it can only be inferred that interest of such deceased beneficiary would revert back to the wakf and such income would be available to the wakf to be managed or used as specified in the deed. In other words, the interest of a beneficiary under the wakf deed, would cease on the death of the beneficiary. In the present terms and clause of wakf deed, we cannot equate the wakf deed as a discretionary trust. In the case of Weir's Settlement Trust: In re (1970) 76 ITR 53 (CA), the issue had cropped up regarding cessor of an interest of a beneficiary in a discretionary trust. On the facts of that English case and on the facts available, it was held that when one of the beneficiaries of discretionary trust dies no charge of duty arises. But the case of the beneficiary in the appeal before us is not under a discr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eneficiary was includible in the estate of the deceased. Thus, the contentions on behalf of the accountable person regarding exclusion of the interest on the principal estate, cannot be supported. 15. There is another aspect of the contention made before us, on behalf of the accountable person. It was urged that the authorities below were not justified in taking a high value of the properties for the purpose of inclusion. According to the accountable person, the valuation was without any basis and standard and was arbitrary. 16. We have heard both the sides and we have gone through the details given in the orders of the authorities below and other materials available. After considering the location of the properties, size, income yielding capacity, etc., we are of the opinion that the Appellate Controller has appropriately reduced the valuation in respect of Holding Nos. 674, 675, 88 and 89. In our opinion no further relief is justified. In this connection, there is also another aspect of the matter regarding the submission that the interest of the deceased in these assets was only at 1/4th in place of 1/7th, as determined in the income-tax matters. It is seen that the CIT(A) h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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