Notional partition under estate duty law requires a legally possible partition; sole surviving coparcener's entire interest passes on death.

For estate duty purposes, section 39(1) applies a notional partition only where a legal partition could have taken place immediately before death. On the stated facts, the deceased was the sole surviving coparcener, so no valid partition was possible and the wife could not claim a coparcenary share. The claim that only half the Hindu undivided family property passed was rejected, and the entire coparcenary interest was treated as passing on death. The reference was decided against the accountable person and in favour of the Department.

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Issues: (i) Whether, on the facts and circumstances, only half of the Hindu undivided family property passed on the death of the deceased; (ii) Whether, where the deceased was the sole surviving coparcener with absolute power of disposition, a notional partition was to be presumed under section 39(1) of the Estate Duty Act, 1953; (iii) Whether the entire Hindu undivided family property passed on the death of the deceased.

Issue (i): Whether, on the facts and circumstances, only half of the Hindu undivided family property passed on the death of the deceased.

Analysis: Section 39(1) deems the value of the benefit arising from the cesser of a coparcenary interest to be the principal value of the share that would have been allotted to the deceased had there been a partition immediately before death. On the facts, the deceased was the sole surviving coparcener and there was no other coparcener with whom a partition of ancestral property could take place.

Conclusion: The question was answered in the negative and the claim that only half the property passed was rejected.

Issue (ii): Whether, where the deceased was the sole surviving coparcener with absolute power of disposition, a notional partition was to be presumed under section 39(1) of the Estate Duty Act, 1953.

Analysis: A notional partition under section 39(1) presupposes a partition that could legally have taken place immediately before death. In a Hindu undivided family consisting only of the deceased and his wife, no partition was permissible, since the wife could not claim a coparcenary share. The interest, therefore, did not get reduced by any presumed partition.

Conclusion: The question was answered in the negative.

Issue (iii): Whether the entire Hindu undivided family property passed on the death of the deceased.

Analysis: Where the sole surviving coparcener dies without male issue and no partition could have been effected immediately before death, the entire coparcenary interest passes to the heir. The property remained intact as ancestral/coparcenary property until death, and the whole interest became subject to estate duty.

Conclusion: The question was answered in the affirmative.

Final Conclusion: The reference was decided against the accountable person and in favour of the Department, holding that the entire Hindu undivided family property passed on the death of the deceased.

Ratio Decidendi: For purposes of section 39(1) of the Estate Duty Act, 1953, a notional partition can be presumed only if a legal partition was possible immediately before death; where the deceased was the sole surviving coparcener and no partition could have been effected, the entire coparcenary interest passes on death.

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