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TMI Blog1979 (10) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the deceased on the date of death alone could be deemed to pass or the market value of those securities at the time of the death ? " The facts giving rise to these questions briefly stated are that late Sri Pearey Lal Banerjee, an advocate, had created a trust for his benefit and the benefit of his sons and daughter-in-law. The trust was in respect of Govt. securities of the face value of Rs. 10 lakhs and the Imperial Bank of India (now State Bank of India), Strand Road, Calcutta, was appointed as the trustee. The instrument of trust was executed on October 26,1937. The settlor had by clause (3) of the instrument reserved to himself a right to revoke, vary or modify all or any of the trust and powers declared by the instrument or conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvanced on behalf of the accountable person and, in the alternative, it was further contended that the interest of the deceased in the trust being only a life interest, the value of that interest could not be equated with the value of the corpus of the trust. The Appellate Controller did not accept this submission and dismissed the appeal. The accountable person took the matter in farther appeal before the Appellate Tribunal. The Appellate Tribunal held that the trust fund constituted property in the income of which the deceased had a life interest and that interest ceased on his death and corresponding interest accrued to the accountable person as result thereof. The case was thus covered by S. 7(1) of the Act. The Appellate Tribunal also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under s. 5 of the Act. On appeal by certificate, it was held by the Supreme Court that only one-third of the trust properties passed on the death of Safiabai. Her right to the property was purely a personal right but that did not make much of difference because what is relevant in determining the scope of the expression " property passing on the death of the deceased " occurring in s. 2(16) of the Act is the change in the beneficial interest and not title. Reliance was placed on an earlier decision in Mahendra Rambhai Patel v. CED [I 967] 63 ITR 645 (SC). It would thus be seen that the deceased had beneficial interest in the trust property and that interest passed on his death. Coming to the valuation of that interest, it would be seen th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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