Life interest in residuary trust income was not an asset situated in India, so estate duty did not apply.

A widow's life interest under a will in the income of a composite trust fund was held not to constitute a specific asset situated in India for estate duty purposes. She had no segregated entitlement to the shares in Spencer and Co. Ltd. or any enforceable right against the company; her right was only against the executors in England to receive income from the residuary trust fund after administration expenses and bequests. The beneficial interest was therefore an equitable claim enforceable in England, not property passing in India, so estate duty under section 7 of the Estate Duty Act was not attracted.

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Issues: Whether the widow's interest under the will in relation to the shares and the residuary estate constituted an asset located in India so as to attract estate duty.

Analysis: Under the will, the widow was not specifically given the shares in Spencer and Co. Ltd. or any segregated interest in those shares. Her entitlement was confined to receiving, for life, the income of the trust fund created from the residue of the estate after sale, conversion, payment of debts, legacies and annuities. The trust fund was a composite fund made up of various sources and the widow had no enforceable right against the company for the shares or their dividends. Her right lay only against the executors in England, and the beneficial interest was thus an equitable claim enforceable there, not a specific asset situated in India.

Conclusion: The widow had no interest in the shares located in India and no property passed in India so as to attract estate duty under section 7 of the Estate Duty Act; the answer was in the negative and in favour of the assessee.

Ratio Decidendi: A life beneficiary's right under a will to receive income from a composite trust fund, without any specific entitlement to identifiable Indian assets, is not an asset located in India for the purpose of estate duty.

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