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TMI Blog2000 (1) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... our view the entry at Serial No. 54 was wrongly made as there was no separate reference in respect of R. A. Nos. 921 to 923. We, therefore, treat this case as E. D. R. No. 53 of 1979 and proceed to dispose of the same accordingly. This is a consolidated reference by the Income-tax Appellate Tribunal, Delhi Bench "D", Delhi, arising out of an order dated August 6, 1977, passed by the said Tribunal in Estate Duty Appeals Nos. 4, 8 and 9 (Delhi) of 1976-77 and the reference has been made at the instance of the accountable person, Raj Kumar Goyal, as well as the Controller of Estate Duty, Meerut, who had made Reference Applications Nos. 1001 and 1002 (Delhi) of 1977-78 and Reference Applications Nos. 921, 922 and 923 (Delhi) of 1977-78, respectively. At the instance of the accountable person, the following questions have been referred for the opinion of this court : "1. Whether, on the facts and in the circumstances of the case, section 34(1)(c) became inoperative and ineffective in view of the decision of the Madras High Court in V. Devaki Ammal v. Asst. CED [1973] 91 ITR 24, in face of the contrary decisions of the Andhra Pradesh High Court in N. V. Somaraju v. Government of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the amount of Rs. 82,144 standing to the credit of Smt. Champa Devi, mother of the deceased, reverted to the two Hindu undivided families of the deceased and his brother, Baij Nath, and only 1/6th share of 1/2 share of Rs. 82,144 was includible in the estate of the deceased. We have beard Sri P. K. Mishra, advocate holding brief from Sri Bharatji Agarwal, counsel for the assessee, and Sri Shambhu Chopra, learned standing counsels for the Controller-respondent. The matter relates to the levy of estate duty on the death of one jai Prakash Goyal who died on May 22, 1973, leaving behind a widow, four sons and two daughters. He was admittedly a member of the Hindu undivided family and, therefore, the Assessing Officer aggregated the value of the shares of the lineal descendants of the deceased for determining the rate of estate duty to be paid on the property on the death of the deceased. It was contended on behalf of the accountable person that in view of a decision of the Madras High Court in V. Devaki Ammal v. Asst. CED [1973] 91 ITR 24, by which section 34(1)(c) of the Estate Duty Act was held to be discriminatory and violative of article 14 of the Constitution of India, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to ascertain the share of the deceased in the coparcenary property. For, by doing that alone can one determine the extent of the claimant's share. Explanation I to section 6 resorts to the simple expedient, undoubtedly fictional, that the interest of a Hindu Mitakshara coparcener 'shall be deemed to be' the share in the property that would have been allotted to him if a partition of that property had taken place immediately before his death. What is, therefore, required to be assumed is that a partition had in fact taken place between the deceased and his coparceners immediately before his death. That assumption, once made, is irrevocable. In other words, the assumption having been made once for the purpose of ascertaining the share of the deceased in the coparcenary property, one cannot go hack on that assumption and ascertain the share of the heirs without reference to it. The assumption which the statute requires to be made that a partition had in fact taken place must permeate the entire process of ascertainment of the ultimate share of the heirs, through all its stages. To make the assumption at the initial stage for the limited purpose of ascertaining the share of the decease ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it will lead to strange results which could not have been in the contemplation of Parliament when it enacted that provision and which might also not be in the interest of such female heirs. To illustrate, if what is being asserted is accepted as correct it may result in the wife automatically being separated from her husband when one of her sons dies leaving her behind as his heir. Such a result does not follow from the language of the statute. In such an event she should have the option to separate herself or to continue in the family as long as she wishes as its member though she has acquired an indefeasible interest in a specific share of the family property which would remain undiminished whatever may be the subsequent changes m the composition of the membership of the family. As already observed the ownership of a definite share in the family property by a person need not be treated as a factor which would militate against his being a member of a family. We have already noticed that m the case of a Dayabhaga family, which recognises unity of possession but not community of interest in the family properties - amongst its members, the members thereof do constitute a family. Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... coparcenary interest inv6lved in the share. This finding of fact is not challenged and, therefore, we answer question No. 2 holding that the lineal descendants of the deceased had no share in the goodwill of the firm, Him Pine Industries and nothing was includible in the estate of the deceased under section 34(1)(c) of the Estate Duty Act on that account. The third question referred at the instance of the Controller is about a deduction allowed for the marriage expenses of the two unmarried daughters of the deceased for determining the 1/6th share of the deceased in the Hindu undivided family properties which passed on his death. Under section 44 of the Estate Duty Act, 1953, the value of debts and encumbrances has to be allowed as a deduction in determining the chargeable value of the estate. The question, therefore is whether the expenses that might be incurred on the marriage of the two daughters that remained unmarried at the time of the death of jai Prakash Goyal could be treated as a debt or an encumbrance, The Tribunal has placed reliance on article 440 in Mulla's Commentary on Hindu Law and observed that the right to maintenance arose out of the fact that the deceased h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... band to maintain his wife does not by itself create any charge on his property and, therefore, no deduction can be allowed, on that account. A similar view was taken by the Andhra Pradesh High Court in CED v. P. Leelavathamma [1978] 112 ITR 739. Our view finds support from the aforesaid two decisions. We may also mention that the daughters succeeded to the estate of the deceased as heirs of class I by virtue of section 8 of the Hindu Succession Act. Therefore, they became the owners of the properties so inherited and there is nothing to show that the property so inherited by them was insufficient to meet the expenses of their marriage. In our view, therefore, the estimated marriage expenses of the two unmarried daughters cannot be allowed as a deduction in determining the value of the estate of the deceased. We, therefore, answer question No. 3 in favour of the Controller of Estate Duty and against the accountable person. Now we come to question No. 4. The controversy is whether the credit balance in the account of Sri jugal Kishore, the father of the deceased, was the property of the Hindu undivided family of the deceased and his brother, Sri Baij Nath, or not. The Tribunal has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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