Provident fund nominee rights arise only on death, so the subscriber's balance passed on death for estate duty purposes.

A provident fund amount remained part of the deceased subscriber's estate where the fund rules allowed him to control nominations, make withdrawals and obtain payment during his lifetime, and the nominee's right arose only on death. The Court held that this retained proprietary interest meant the credit balance passed on death within the Estate Duty Act and was liable to estate duty in the hands of the accountable person. The contention that the amount was outside the estate or formed a separate non-aggregatable estate was not examined, as it had not been raised before the Tribunal and did not arise from the reference.

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Issues: Whether the amount standing to the credit of the deceased in the Indian Civil Service (Non-European Members) Provident Fund and paid to the nominated widow was liable to estate duty in the hands of the accountable person.

Analysis: The Rules governing the provident fund showed that the subscriber retained control over the fund during his lifetime, including the power to make and vary nominations, withdraw amounts for permitted purposes, and obtain payment on retirement. The nominee's entitlement arose only on the death of the subscriber and was contingent until that event. The Provident Funds Act, 1925 supported this position by recognising that the nominee's right becomes effective on death and does not divest the subscriber of ownership during his lifetime. On that basis, the amount standing to the deceased's credit remained his property until death and passed on death within the meaning of the Estate Duty Act. The contention that the amount was outside the estate or formed a separate estate not aggregatable was not entertained because that question had not been raised before the Tribunal and did not arise from the reference.

Conclusion: The amount was liable to estate duty, and the reference was answered against the accountable person.

Ratio Decidendi: Where a provident fund remains under the subscriber's control during his lifetime and the nominee's right matures only on death, the subscriber retains a proprietary interest in the fund and the amount passes on death for estate duty purposes.

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