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TMI Blog1987 (8) TMI 125X X X X Extracts X X X X X X X X Extracts X X X X ..... m, Accountant and Authorised Representative for the accountable persons. He indicated that for later few years, the case was represented by Shri P.N. Saxena, Advocate and Shri P.K. Das, Accountant. Various details and informations were called for. The accountable persons furnished the details and the available books of account were produced. The assessing officer indicated that the computation of the principal value of the estate was based on various replies, available pieces of information, the details, etc., furnished by the accountable persons as well as information gathered from various sources. 3. He mentioned that the deceased was a businessman having shares in many limited companies and was also in the management of various companies. He also noticed that the deceased was a partner in M/s J.P. Srivastava Sons. He found that the deceased did not run any business as a proprietor nor he maintained any personal account books and that all the assets and liabilities were in his individual capacity. The assessing officer went on to determine the value of the different properties including immovable and movable properties. Undoubtedly, the estate of the deceased was quite large ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indicated that the assessment was completed in a great hurry by the present Assistant Controller of Estate Duty and in an arbitrary manner without giving proper opportunity of being heard. 6. It was also contended that even where there was no specific period of limitation provided, it was well settled that there should not be any inordinate delay and the proceedings must be completed within a reasonable time. Different case laws were cited in that regard. 7. It was submitted also that section 73A of the Act placed limitation for commencement of proceedings or reassessment from which it could be seen that the intention of the Legislature was to prescribe reasonable period of 5 years from the date of death of the deceased for initiation of proceedings for the first assessment and a period of 3 years from the date of assessment, in the case of reassessment. It was thus submitted before the Appellate Controller that the assessment proceedings should be completed within a reasonable time within 8 years or so. Inter alia, it was pleased, therefore, that the assessment proceedings should be annulled having been barred by time. It may be mentioned here that the assessment made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me. He was of the view that the word "reasonable time" cannot be stressed beyond a particular stage and has to be determined in the light of the provisions of section 71. He was, therefore, of the view that the period of limitation cannot be extended beyond 20 years by any stretch of imagination and, therefore, the Assistant Controller was not legally justified in keeping the assessment pending for a period exceeding 20 years. He was of the view that the limitation has to be read along with the provisions of section 71 and call for strict construction in favour of the assessee so that the assessee is not deprived of his right to property for no fault of his. Accordingly, he held that the assessment which has not been completed within a reasonable time cannot be sustained and was, therefore, cancelled. 10 The Appellate Controller went on to consider whether the delay could be attributed to the accountable persons. He noted that it was submitted before him that the delay was because of the inaction on the part of the department for a long period, for which details were noted in the order itself and the total of such delay works out to 19 years and 9 months or 20 years in round figu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be cancelled for which there was no sanction under the law. It is vehemently urged that the Appellate Controller having not given due regard to the provisions of the Estate Duty Act, his order required to be reversed and that of the Assistant Controller required to be maintained. It is submitted that admittedly no time limit has been prescribed by the Estate Duty Act for completion of the estate duty assessment and, therefore, the Appellate Controller went wrong in imposing a condition as done by him in the present case. Amongst other things, it is also submitted that the Appellate Controller went wrong on facts in stating that the delay was mainly due to the inaction of the department ; whereas in fact it was the accountable person in their applications who had asked for adjournments on several occasions whenever case was fixed for hearing and that more particularly when the case was fixed for last time, the accountable persons did ask for more time for furnishing the details, evidence, etc., regarding the liability to be deducted from the principal value of the estate. It is vehemently contended on behalf of the revenue that this factual position was totally missed or ignored b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whenever required by the assessing authority, the same were furnished as noted in the assessment order itself. It is also submitted that it is true that the accountable persons did ask for time on different occasions and that too for good reasons and on this fact alone, nothing would turn out and in fact such short adjournment on different occasions would not contribute materially to the delay in completion of the proceedings which was due to the inaction and default on the part of the department. Different aspects of the observations and comments made by the Appellate Controller in his order are emphasised and clarified before us as well. It is submitted that it is true that there is no time limit set for completion of the estate duty assessment. But it is pointed out that assessment would have to be done within reasonable time. It is submitted also that reasonable time would have to be considered on the facts of the case. It is pointed out that in the present case, the delay was inordinate and the accountable persons were kept in anxiety for no fault of theirs. It is submitted that the onus lies on the revenue for such delay and in fact the Appellate Controller has noticed and re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le persons filed statement of reports of valuer in respect of various items which the Assistant Controller took into consideration. In certain cases break-up method was also considered in respect of valuation of certain unquoted shares. As indicated earlier, the minus gross value of the estate was returned at Rs. 3,85,534 ; whereas the gross value of the estate was determined at Rs. 26,04,127, against which, the liability of Rs. 14,85,981 was claimed. Thus, one could see the magnitude and the extent of the various properties involved in the present estate. Naturally, accountable persons would have required time to obtain various papers, details, evidence, etc., to be produced before the assessing officer in support of the return. On his part also, the assessing officer would have needed sufficient time to take up such matters. On this point, we may remind ourselves that the Legislature made provision for time within which any proceeding either assessment, penalty, etc., could be initiated and finalised under the Income-tax Act, Wealth-tax Act, etc. But as far as the completion of the estate duty assessment once validly initiated, there is no time limit prescribed. We do not intend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view the various details needed for the assessment, could not have passed a best judgment or rather passing of such an order would be worst judgment order. We are satisfied that many details have been brought out in the assessment order as furnished by the accountable persons or as collected by the assessing officer in bringing out this estate duty assessment order. Of course, there might be some gap of delay here and there but from that it could not be inferred that inaction was due entirely to the department. One has to look to the overall aspects of the entire circumstances. As pointed out by the learned counsel for the accountable persons, the Hon'ble Supreme Court in the case of Patel Raghav Nath has held that although there was no period of limitation, but power must be exercised in a reasonable time and the length of the reasonable time must be determined on the facts of the case, and the nature of the order. In the instant case, reasonable time had to be given to the accountable persons concerned. In our opinion, the accountable persons had to be given adequate and reasonable time to produce materials, etc., and that time should be reasonable and proper. From the orders o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... There is no scope for importing into the statute words which are not there, as such importation would not to construe, but to amend the statute. This is the view of the Hon'ble Supreme Court in the case of Smt. Tarulata Shyam v. CIT [1977] 108 ITR 345. It was also held therein that even if there be a "casus omissus", the defect can be remedied only by legislation and not by judicial interpretation. But the Appellate Tribunal in the instant case, has overstepped his jurisdiction in holding that the Appellate Controller was not legally justified in keeping the assessment pending for a period exceeding 28 years ; whereas in fact there was no legal provision that no assessment proceedings should be kept pending for a period exceeding 20 years. From the reading of the impugned order, it is clear that the Appellate Controller inferred that as the assessment which had not been completed within a reasonable time but much beyond and in the light of these case laws referred to by him, deserved to be cancelled. In fact, the Appellate Controller did not sustain the estate duty assessment and had cancelled the same. We are of the opinion that the Appellate Controller has imported such limitati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontroller to be reasonable in the instant case. As indicated earlier, initiation of the assessment proceedings in the instant case was not in dispute. 22. We have gone through all the decisions cited by both the sides at the time of hearing and we have got immense benefits for our consideration in dealing with the present dispute before us. Considering the totality of the facts and circumstances of the case as well as the various details available on record, we are of the opinion that the period of the delay cannot be said to have not been explained by the department. In fact, it is a sound rule of interpretation that statute should be so construed as to prevent the mischief and to advance the remedy according to the true intention of the makers of the statute--Sevantilal Maneklal Sheth v. CIT [1968] 68 ITR 503 (SC). In connection with the estate duty matters, the Hon'ble Madras High Court in the case of CED v. Amarlal [1984] 147 ITR 248, on the facts of the case, held that the Court, in construing the statutory provisions, cannot take into consideration the hardship that may be caused in a particular case. It is true that if the assessment is delayed, the accountable persons may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and at Khalasi Lines, Kanpur. The value was shown at Rs. 15,875 which was purchased in 1943 for Rs. 8,056 and Rs. 7,700. In the assessment, Rs. 44,400 was taken after considering the ratio of appreciation in 20 years, and that too after considering Rs. 6 per sq. yd. as the market value. The accountable persons submitted before the Appellate Controller that the rate was excessive. It was insisted that the value cannot be more than Rs. 3 per sq. yd. on the facts of the case. The Appellate Controller adopted the rate at Rs. 4.50 per sq. yd. This rate appears to be reasonable and no interference is necessary. 27. In respect of the value of Nishat Manzil, Bhopal, the accountable persons showed the value at Rs. 75,000 which was assessed at Rs. 2,20,000. The accountable persons submitted before the Appellate Controller that it was wrong for the assessing officer, to base his valuation on the basis of the report of valuation by the Executive Engineer which was made on incorrect facts. It was submitted also that the submissions of the accountable persons were not properly considered. The Appellate Controller found that some portion of the property was let out subsequently in the year 1959 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istant Controller to determine the value of the assets and unquoted shares held by these companies on break-up valuation basis. The Appellate Controller has also on same reasonings allowed relief of Rs. 8,780 in the value of the shares of New Bhopal Textiles Ltd. We have gone through his decision and the basis adopted by him. In our opinion, the valuation in respect of these two items was quite reasonable and fair. No interference is called for. 30. In respect of the value of shares of Sir J.P. Srivastava Sons (Rampur) Ltd., the Appellate Controller allowed relief of Rs. 35,673. Here also we would adopt the similar reasonings as taken by the Appellate Controller. The facts of the case as in other times have been discussed by him in the appellate order at length. The reduction, in our opinion, was quite justified. 31. The reduction of Rs. 7,500 is also appealed against by the revenue. After considering the facts available and the materials brought on record, this reduction is reasonable. 32. The next item is regarding the reduction by Rs. 10,155 in respect of the value of book debts of Indian Bobbin Ltd. The value was assessed at Rs. 20,311. It was noted that the said compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdingly, this part of the order of the Appellate Controller is set aside for fresh disposal. 34. The next item of liability is of Rs. 2,25,000 as liability claimed to be due to J.P. Srivastava. In the assessment order, the assessing officer noted that he asked the accountable persons to prove the genuineness of the liability. He noted that it was clear that the deceased borrowed money from Lady Kailash Srivastava and on that account interest was regularly considered under the head "other sources". The accountable persons give extract from the wealth-tax orders of Lady Kailash which has been shown as a loan to the deceased. He noted that a like liability of Lady Kailash was shown to be due to Mr. J.K. Srivastava, son of the deceased. The accountable persons furnished explanation which was reproduced in the assessment order. The assessing officer found no documentary evidence to establish the existence of the liability. He noted that it was noticed that the deceased had been giving considerable gifts to the son from time to time and this fact would go to show that there was no loan payable by the deceased to the son and the whole story of the liability was a bogus one. The claim wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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