Estate duty on land acquisition compensation turns on the surviving right's value at death, not later civil court enhancement.

A pending and unacquiesced claim for enhanced land acquisition compensation was treated as a single surviving right to receive compensation at market value on the date of acquisition, and that right remained property chargeable to estate duty on the date of death. Its value had to be estimated by reference to the relevant date and litigation risk, not by treating a later civil court enhancement as the property itself. Notices under section 59(a) and section 61 of the Estate Duty Act, 1953, were unsustainable because they proceeded on the premise that the acquired land still formed part of the estate and that later enhancement disclosed an apparent mistake; that was a change of opinion, not rectification.

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Issues: (i) Whether the right to receive compensation for acquired land, where the land acquisition award was not accepted and land references were pending, survived as property chargeable to estate duty on the date of death and could be valued for estate duty purposes; (ii) Whether notices issued under section 59(a) and section 61 of the Estate Duty Act, 1953, could validly be sustained on the basis of enhanced compensation awarded later by the civil court.

Issue (i): Whether the right to receive compensation for acquired land, where the land acquisition award was not accepted and land references were pending, survived as property chargeable to estate duty on the date of death and could be valued for estate duty purposes.

Analysis: The right arising on acquisition is a single and indivisible right to receive compensation for the land at its market value on the date of acquisition. The award made by the Collector is only an offer of compensation and, where it is not accepted and the claimant seeks a reference, that right remains alive and is prosecuted in the civil court. The subsequent enhancement by the civil court does not mean that a separate right to extra compensation came into existence only on the later date. For estate duty, the relevant task is to estimate the value of that surviving right as on the date of death, having regard to the then existing marketability and the risk inherent in the pending litigation.

Conclusion: The right to receive compensation was property chargeable to estate duty, but its value had to be determined as on the date of death and not by treating the later enhanced award as the property itself.

Issue (ii): Whether notices issued under section 59(a) and section 61 of the Estate Duty Act, 1953, could validly be sustained on the basis of enhanced compensation awarded later by the civil court.

Analysis: The notice under section 59(a) was founded on the wrong premise that the acquired lands still formed part of the estate and that the later enhancement showed undervaluation of those lands. That basis was legally unsustainable because the lands had already vested in the Government and only the right to compensation could be valued. The reopening therefore rested on an incorrect legal foundation. The notice under section 61 also failed because the revenue was not correcting a mistake apparent from the record; it was attempting to revise the original valuation by adopting a later civil court valuation, which amounted to a change of opinion. Such a course belonged, if at all, to reassessment proceedings and could not be pursued through rectification.

Conclusion: Both notices were invalid, and the consequential reassessment and rectification proceedings could not stand.

Final Conclusion: The decision settled that, for estate duty, the taxable property was the surviving right to receive compensation as valued on the relevant date, while later enhancement by the civil court could not be retrospectively treated as the property or as a ground for rectification on the basis of a supposed apparent mistake.

Ratio Decidendi: A pending and unacquiesced claim for enhanced land acquisition compensation is part of the same compensatory right that arose on acquisition, and later civil court enhancement cannot be used to reopen estate duty assessment on the erroneous footing that the acquired land itself formed part of the estate or to invoke rectification in place of reassessment.

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