Wakf settlement and estate duty: mere appointment as mutavalli does not create a retained beneficial interest.

A wakf settlement was not brought within section 12 of the Estate Duty Act, 1953 because the settlor had irrevocably divested ownership and reserved no life interest, reversionary right, or other beneficial interest linked to death. The office of mutavalli was treated as distinct from ownership, so the mere fact that the settlor later became mutavalli did not amount to retention of an interest in the settled property. The property was therefore validly transferred to the wakf and its value was excluded from the deceased's estate, with the issue decided in favour of the assessee.

---

---

Issues: Whether the value of property settled on wakf was includible in the deceased's estate under section 12 of the Estate Duty Act, 1953, merely because the settlor became mutavalli.

Analysis: The wakf deed showed that the settlor had clearly divested himself of ownership and had not reserved to himself any right to reclaim the property, any life interest, or any other interest determinable by reference to his death. The deed also indicated that he would not receive income for himself. The office of mutavalli was treated as legally distinct from ownership, and the mere fact that the settlor became mutavalli did not amount to retention of a beneficial interest in the property for the purposes of section 12.

Conclusion: The property was validly transferred to the wakf and its value was not includible in the deceased's estate; the issue was answered against the Revenue and in favour of the assessee.

Ratio Decidendi: Where a settlor has irrevocably divested ownership in favour of a wakf and reserves no beneficial interest in the property, the property is not attracted by section 12 of the Estate Duty Act, 1953 merely because he holds the office of mutavalli.

---