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TMI Blog1967 (8) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... of 5 chhatak 15 padika (1/3rd Kt. or 240 sft.) for which revenue of -/3/6 per annum is payable to superior landlord Sri Chandra Kanta Mondal: On these two holdings aggregating to 1 Kt. 7 ch. of Bastuland with three storied pucca structure thereon with verandah, well, privy and compound wall which I had purchased from Sm. Jnano-damoyee Dasi and others on 2nd Ashar 1340 B.S. corresponding to 16th June, 1933, under a registered conveyance and subsequently known as holding No. 3 in the municipal register. (2)Within the said jurisdiction at Mouza Bibiganj Mohalla Sahabharangbazar, Khatian No. 586, plot No. 1874, bastuland comprising .01 and within the said Mohalla, Khatian No. 765, plot No. 1875, bastu land comprising .02 for which revenue of -/8/- is payable to the shebait of Pir Shaheb of Sahabharangbazar: On these two holdings aggregating to .03 of bastu land with pucca structure thereon with well, privy and compound wall which I had purchased from Sri Hari Sadhan Bid on 23rd Kartick 1343 B.S. corresponding to 9th November, 1936, under a registered conveyance and subsequently known as holding No. 5 in the municipal register. The particular portion of the deed of arpannama, wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontended before the Board: (1)that the deceased had made an absolute settlement long before his death and years before estate duty legislation was even thought of, which were circumstances indicating the bona fides of the settlement in favour of the deity; (2)that the deceased had not reserved any benefit for himself in respect of the dedicated properties and that the entire income from the said properties were directed to be spent for Deva Seva; (3)that although there was a right in the deceased to reside in the property, in which the deity was installed, this fact alone should not invalidate the trust; (4)that the shebait being a trustee as well as holder of an office his position as a trustee would not attract the provisions of section 10 of the Estate Duty Act; (5)that the enjoyment of the usufruct as a shebait would not make the properties dutiable, in view of the provisions contained in section 7(4) of the Estate Duty Act. The Board observed that by the Bengali deed of arpannama, dated 12th December, 1938, the following properties were dedicated to the family deity Sree Sree Laxmi Narayan Jiu; (i)House property at Bibiganj, Midnapore, plot Nos. 1876, 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the deed of arpannama and right of residence of the shebait was reserved in the one house, in which the deity was installed, and not in the other house. Therefore, taken at the worst, only one house may be taken to have passed on the death of the deceased and nothing else (this, however, he did not admit but merely assumed for the sake of argument). (ii)that the dedication was an absolute dedication in respect of all the properties, even in respect of the house in which the deity was installed. There was no reservation made in respect of the verandah and the shop room in the front portion let out to a shop and in respect of the portion reserved for residence of the shebait. (iii)the reservation of right of residence by a shebait is reservation of interest only as a holder of an office and such an interest is not one which passes on death because of the provisions contained in section 7(4) of the Estate Duty Act. (iv)That the dedication being absolute and without reservation, the deity must be deemed to have assumed bona fide possession and enjoyment of the dedicated properties to the exclusion of the settlor and as such the mischief of section 10 or 12 was not attracted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nite significance and one can be sure about the sense in which such conveyancer would use it, it may not be reasonable and proper to give the same strict interpretation of the word, when used by one who is not so equally skilled in the art of conveyancing. Sometimes it happens, in the case of documents as regards disposition of properties, that there is a clear conflict between what is stated in one part of the document and in another. A familiar instance of this is where in an earlier part of the document some properties are given absolutely to one person but later on, other directions about the same property are given which conflict with and take away from the absolute title given in the earlier portion. It is well settled that in cases of such a conflict the earlier disposition of absolute title should prevail and the later direction of disposition should be disregarded as unsuccessful attempt to restrict the title already given (vide Mohammad Kamgarh Shah v. Jagdish Chandra Deo Dhabal Deb AIR 1960 SC 953). It is clear, however, that an attempt should always be made to read the two parts of the documents harmoniously, if possible; it is only when this is not possible, e.g., wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It may be that since one room in the dedicated house stood let out as a shop room, that fact was only mentioned and in order to make that portion beneficially dedicated to the deity it was provided that the rent shall be applied to meet the devaseva expenses. We do not, therefore, propose to proceed on the basis that only a part of the house, in which the deity was installed, was dedicated to him. We now take up for consideration the effect of reservation of part of the house, in which the deity was installed, for residence of the shebait. Now, under the conception of Hindu law, it is in an ideal sense that the dedicated property vests in an idol and in the nature of things the possession and management of it must be entrusted to some person called shebait or manager. In the case of Prosunno Kumari Debya v. Golab Chand Baboo [1875] LR 2 IA 145 the Judicial Committee observed: It would seem to follow that the person so entrusted must of necessity be empowered to do whatever may be required for the service of the idol and for the benefit and preservation of its property, at least to as great a degree as the manager of an infant heir. If this were not so, the estate of the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the usufruct depending again on usage and custom. In no case was the property conveyed to or vested in him; nor is he a 'trustee' in the English sense of the term, although in view of the obligations and duties resting on him, he is answerable as a trustee in the general sense for maladministration'. As regards the shebait's right of residence in the house dedicated to the deity, the usual practice is to make provision regarding it in the deed of dedication itself. A direction by the founder that the shebaits for the time being would be entitled to reside in the house set apart for the deity does not make the dedication in any way invalid or improper. In the case of Jnanendra v. Surendra [1920] 24 CWN 1026, the Privy Council observed: It is a perfectly reasonable arrangement to secure that the man in whose hands the sepervision of the whole estate is vested shall have associated with his duties the right to reside in the same dwelling house. In Dr. Mukherjea's treatise on Hindu Law of Religious Charitable Trust, the learned author further says as follows: Even if there is no provision in the deed of endowment, it seems that such right of resid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eafter, until his death on July 11, 1959. The question was whether and to what extent estate duty was chargeable in regard to these premises under section 10 of the Estate Duty Act, 1953. This court held that the lease gave to the donor possession and enjoyment of the property itself and the case fell within the statutory charge under section 10: the lease at whatsoever rent prevented the entire exclusion of the donor envisaged by that section. As, however, section 10 provided that such property was chargeable only to the extent that the deceased was not excluded, estate duty was payable by the accountable persons only on that portion of the premises which was in the occupation of the deceased as a lessee. In holding as this court did, this court examined several analogous provisions of certain foreign statutes and foreign authorities and collected the following principles therefrom as applicable to the interpretation of the scope and effect of section 10 of the Estate Duty Act. Those principles were: (a)In order to avoid the mischief of section 10 of the Estate Duty Act, 1953, it must be established that the donee not only assumed bona fide possession and enjoyment of the prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mahatma Gandhi Road, Bangalore, was correctly included in the estate of the deceased as property passing or deemed to pass on his death under section 10 of the Act ? The High Court answered the question in the affirmative, holding that the appellant was liable to pay estate duty with regard to the house. Thereafter the matter was taken before the Supreme Court, at the instance of the accountable person. The Supreme Court upheld the opinion of the High Court on the following interpretation of section 10 in George Da Costa v. Controller of Estate Duty [1967] 63 ITR 497: The question involved in this appeal depends upon the proper interpretation of section 10 of the Act. The intention of the legislature in enacting section 10 of the Act was to exclude from liability to estate duty certain categories of gifts. A gift of immovable property under section 10 will, however, be dutiable unless the donee assumes immediately exclusive and bona fide possession and enjoyment of the subject-matter of the gift, and there is no beneficial interest reserved to the donor by contract or otherwise. . . . The crux of the section lies in two parts: (1) the donee must bona fide have assumed posse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nor of the gift must be referable to some contractual or other arrangement enforceable in law or in equity. Even if the donor is content to rely upon the mere filial affection of his sons with a view to enable him to continue to reside in the house, it cannot be said that he was 'entirely excluded from possession and enjoyment' within the meaning of the first limb of the section, and, therefore, the property will be deemed to have passed on the death of the donor and will be subject to levy of estate duty. (PP. 500, 501) Thus, the Supreme Court not only affirmed the principles collected by this court in Rash Mohan Chatterjee's case (supra) but to an extent even went beyond them. Keeping in view the law laid down by the Supreme Court, we have to see how far a settlor who dedicates property to a deity and constitutes himself as the shebait excludes himself from the benefit of the debutter property. If a person absolutely dedicates property to a deity and does not constitute himself as the shebait and does not directly or indirectly reserve any benefit for himself, it cannot be said that he did not exclude himself from the benefits of the endowed property. But in ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but merely constituted himself as the shebait, that fact alone will endow the shebait with some sort of beneficial interest in the dedicated property and by functioning as the shebait he would be enjoying some beneficial interest in the properties dedicated to the deity. This would attract the mischief of section 10 of the Estate Duty Act, because it cannot be said that a shebait after dedication ceases to have any benefit or enjoyment in the dedicated property. In the view that we take, we find that the Board of Revenue did not err in holding that the dedicated properties were such as should be deemed to have passed on the death of the deceased. Even if the deceased did not reserve the right of residence in one of the properties, even then, in law, he would be deemed to have retained some beneficial interest in the property dedicated to the deity and such retention of interest would have the effect that the dedicated property would be deemed to be property which passed on his death. The question referred to this court should thus be answered in the affirmative and against the assessee. The Controller is entitled to the costs of this reference. - - TaxTMI - TMITax - I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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