Estate duty applies where a lifetime rent-collection right ceases on death, creating a taxable benefit to beneficiaries.

A deceased's lifetime right to collect rent from houses allotted to his sons under a partition deed was treated as an interest in property that ceased on death. Although the sons became absolute owners of the houses, the rent was withheld from them until the deceased died, and they then became entitled to receive it. That cesser of the deceased's tangible income-right created a corresponding benefit to the sons, bringing the arrangement within section 7 of the Estate Duty Act. The valuation under section 40 was not disputed, and the reference was answered for the revenue.

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Issues: Whether the deceased's right to collect rental income from the properties allotted to his sons under the partition deed constituted an interest in property ceasing on his death so as to attract section 7 of the Estate Duty Act.

Analysis: Under the partition deed, the sons became absolute owners of the houses, but the deceased was given the right to collect the rent from those houses during his lifetime. That right withheld the income from the allottees until his death, and on his death the sons became entitled to receive the rent. The right to collect rent was therefore a tangible interest connected with the property, and its cessation on death resulted in a corresponding benefit to the sons. The Court distinguished the cases relied on for the accountable person and held that the present arrangement fell squarely within the scope of section 7. The valuation adopted under section 40 was not in dispute.

Conclusion: The deceased had an interest in the properties which ceased on his death, and benefit accrued to the sons on such cesser. The reference was answered in favour of the revenue.

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