Estate duty residential house exemption denied where deceased held only a right of free residence, not ownership of the property.

Exemption under section 33(1)(n) of the Estate Duty Act was confined to a house or part thereof belonging to the deceased and exclusively used by the deceased for residence. The deceased had only a right of free residence under the trust deed, not ownership of the house, so the property itself could not qualify for the exemption; the relevant interest was only a cesser of interest under section 7(1) read with section 40. As the deceased was also not shown to be in exclusive occupation of the entire premises, the statutory conditions for exemption were not satisfied and the claim failed.

---

---

Issues: (i) Whether the house at 103, Walkeshwar Road, Bombay, or any part thereof was property belonging to the deceased for the purpose of section 33(1)(n) of the Estate Duty Act, 1953. (ii) Whether the accountable person was entitled to exemption under section 33(1)(n) of the Estate Duty Act, 1953.

Issue (i): Whether the house at 103, Walkeshwar Road, Bombay, or any part thereof was property belonging to the deceased for the purpose of section 33(1)(n) of the Estate Duty Act, 1953.

Analysis: The deceased had only a right of free residence under the trust deed and not ownership of the house or any part of it. The relevant charging provision for a cesser of such an interest was section 7(1), read with section 40, under which only the benefit accruing on cessation of the interest could be valued. The house itself could not be treated as property belonging to the deceased for exemption under section 33(1)(n).

Conclusion: The house, or any part thereof, was not property belonging to the deceased within section 33(1)(n).

Issue (ii): Whether the accountable person was entitled to exemption under section 33(1)(n) of the Estate Duty Act, 1953.

Analysis: Exemption under section 33(1)(n) requires a house or part thereof exclusively used by the deceased for residence and belonging to the deceased. The deceased was not shown to be in exclusive occupation of the entire house, and the trust deed itself entitled the deceased and her daughters to occupy the premises. The statutory conditions for exemption were therefore not satisfied.

Conclusion: The accountable person was not entitled to exemption under section 33(1)(n).

Final Conclusion: The reference was answered against the accountable person, and the claimed estate duty exemption on the Walkeshwar Road property was rejected.

Ratio Decidendi: Exemption under section 33(1)(n) is available only where the property itself belongs to the deceased and is exclusively used by the deceased for residence; a mere right of free residence gives rise only to a cesser of interest under section 7(1), not to ownership of the house for purposes of the exemption.

---