Death-duty exclusion turns on whether retained donor benefits encumber the gifted interests, not incidental trust advantages.

For death-duty purposes under section 102(2)(d) of the Stamp Duties Act 1920-1940, the relevant inquiry is whether donees immediately assumed and retained bona fide possession and enjoyment of gifted property to the entire exclusion of the donor or any benefit to him. On the stated facts, the children's maintenance and education payments did not defeat their possession and enjoyment, and incidental advantages to the donor were not relevant benefits. By contrast, the donor's remuneration as trustee was a benefit taken out of the trust property and at the expense of the interests given to the children, so it fell within the statutory mischief. The children's four-fifths shares therefore remained includible in the deceased's estate.

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Issues: Whether the value of the children's four-fifths shares in the trust property was excluded from the deceased donor's estate for death duty purposes under section 102(2)(d) of the Stamp Duties Act, 1920-1940, despite the donor's retention of trustee powers, receipt of remuneration, and application of income for the children's maintenance and education.

Analysis: The applicable test was whether the donees had immediately assumed and thereafter retained bona fide possession and enjoyment of the gifted property to the entire exclusion of the donor or of any benefit to him. The decisive enquiry was not whether the donor continued to enjoy advantages connected with the property in a general sense, but whether each alleged advantage was a benefit of a kind that arose out of, or encumbered, the very interests given to the children. The use of the children's income for their maintenance and education, on the facts accepted, did not deprive them of full possession and enjoyment and any incidental advantage to the donor did not amount to a relevant benefit. The donor's remuneration as trustee was also not a reserved beneficial interest in the property, but a monetary benefit taken out of the trust property and at the expense of the interests given to the donees. That advantage therefore fell within the statutory mischief. The other powers relied upon were unnecessary to decide, and the residence and other suggested advantages were not treated as relevant benefits on the facts found.

Conclusion: The children's interests were not excluded from the operation of the section merely because of the maintenance payments and ancillary trustee features, but the trustee's remuneration constituted a benefit to the donor within the section, so the children's four-fifths shares remained includible in the deceased's estate.

Ratio Decidendi: For death-duty provisions of this kind, the relevant enquiry is whether the donor has been entirely excluded from the beneficial enjoyment of the property comprised in the gift; a benefit retained by the donor is material only if it is taken out of, or encumbers, the interests actually given, and not merely because it is an incidental advantage connected with the settled property.

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