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TMI Blog1985 (2) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... assessable to estate duty under the Act and not the entire property. But, the ACED, by his assessment order dated March 11, 1963, held that the entire watan property was the individual property of the deceased and had passed on death, determined its principal value at Rs. 7,94,993 and levied a sum of Rs. 1,08,109.30 as estate duty under the Act. Against the said order of the ACED, the petitioner filed an appeal under the Act before the Appellate Controller of Estate Duty, Madras (Appellate Controller), with an application for stay who did not grant the same and ultimately dismissed the said appeal on July 23, 1971. Against the aforesaid orders of the Appellate Controller and the ACED, the petitioner filed an appeal before the Income-tax Appellate Tribunal, Bangalore (" Tribunal "), which by its order dated December 5, 1973, allowed the said appeal resulting in substantial reduction in the estate duty payable thereto by the petitioner under the Act. Aggrieved by the same, the Revenue sought a reference to this court under s. 64 of the Act in T.R.C. No. 54 of 1974. On April 6, 1978, this court answered the question referred in the said reference in favour of the petitioner, which n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in his application dated April 10, 1978. First, the petitioner has urged that s. 64(7) of the Act should be so interpreted as enabling payment of interest to an accountable person when there is an order made in his favour by the Tribunal also. If this construction of s. 64(7) is not accepted, then the petitioner would say that the provision in so far as it picks up and treats distinctively, only the cases of reductions occasioned by an order made by an High Court, would be violative of article 14 of the Constitution and should be struck down. Lastly, the petitioner has urged that he was entitled for payment of interest under the Interest Act of 1839 (Act XXXII of 1839) (" the Interest Act "). The respondents have resisted this writ petition. Sri G. Chandra Kumar, learned counsel for the petitioner, has contended that s. 64(7) of the Act should be so interpreted as entitling an accountable person for payment of interest on the amount refunded to him in pursuance of an order made by the Tribunal. Sri K. Srinivasan, learned senior standing counsel appearing for the respondents, has urged that the plain language of s. 64(7) of the Act did not permit the construction suggested ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th a particular situation cannot be extended to all and every situations. When the legislature in its wisdom provides for payment of interest only on the basis of an order made by a High Court in a reference under s. 64 of the Act, a court cannot read that provision as also comprehending a situation arising out of an order made by the Tribunal and the first appellate authority under the Act. Any such attempt will be really usurpation of the power of legislation under the thin guise of interpretation. For these reasons, I have no hesitation in holding that the construction suggested by Sri Chandra Kumar cannot be accepted. The above finding itself projects the next contention which in effect is that a provision that denies the benefit of interest to those that have succeeded before the Tribunal brings about a hostile discrimination as between persons who become entitled to refund as a result of an order of the High Court in the proceedings of reference on the one hand and those who become entitled to refund as a result of an order made by the Tribunals on the other. In support of his contention, Sri Chandra Kumar has strongly relied on a ruling of the Madras High Court in G. D. Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umar, the question that arose before the court was whether the court fee paid on probate of the estate passing to an accountable person after the determination of the principal value of the estate and payment of estate duty thereto was deductible to the extent provided in s. 50 of the Act. On that question, Rama Prasad Rao J. (as his Lordship then was), came to the conclusion that the words " have been paid " occurring in s. 50 of the Act should be interpreted as payments made at a later stage also. With respect, this conclusion reached by the court is in accord with certain accepted canons of construction of statutes and is correct. But, having reached that conclusion, the learned judge proceeded to observe thus (p. 651): "The word `Paid' in section 50 has to be understood in the context and in the light of the chapter for which the provision has been made as 'payable'. Otherwise an unsatisfactory state of affairs would result. Relief from estate duty can only be obtained by persons when they have paid the court-fee prior to the imposition of the estate duty and for others who pay such court-fee after the estate duty assessment is finalised, no such relief can be given. This wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein. The court referred to in the Interest Act can only be interpreted as civil courts that have power to adjudicate and decide monetary claims and not authorities functioning under the Act or any other law. On this construction of the section, the claim for interest founded on the Interest Act cannot be upheld. Section 1 of the Interest Act empowers courts to award interest on debts or ascertained sums or cases governed by contracts and not to cases of refunds under a taxation measure as under the E.D. Act. The cases of refunds arising under taxation measures are not regulated by the Act at all. In Municipal Borough's case, AIR 1944 Bom 233, the High Court of Bombay was dealing with a claim for payment of interest on refund of taxes made to the respondent/plaintiff in pursuance of a decree of a civil court which was allowed by the trial court. On revision, Beaumont C.J. reversing the decree of the trial court, expressed thus (p. 233) : " Under the Interest Act (Act 32 of 1839), which introduced into India, the English Interest Act, 3 and 4 Will. IV, c. 42, the court can allow interest if the amount claimed is a sum certain which is payable at a certain time by virtue of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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