Motor accident compensation and accident benefit are not part of the deceased's estate for estate duty purposes.

Compensation payable to legal representatives for death in a motor accident does not form part of the deceased's estate for estate duty purposes because the right arises for the first time on death and is not a right inherited from the deceased. As the compensation was neither property possessed by the deceased during life nor property passing on death, it could not be included in the principal value of the estate under the Estate Duty Act, 1953. The same reasoning applied to the accident benefit amount, which also came into existence only after death and was not chargeable to estate duty.

---

---

Issues: Whether compensation awarded to the deceased's legal representatives for death in a motor accident, including the accident benefit amount, formed part of the principal value of the estate and was liable to estate duty.

Analysis: The right to claim compensation for death under the Motor Vehicles Act, 1939 accrues for the first time to the legal representatives after the death of the injured person and is not a right inherited from the deceased. Compensation payable for death comes into existence only on the death of the person and cannot be treated as property possessed or enjoyed by him during his lifetime. As the amount neither existed in the deceased's hands nor passed from him on death, it could not fall within property passing on death for purposes of estate duty under the Estate Duty Act, 1953. The same principle applied to the accident benefit amount, which also arose only after death.

Conclusion: The inclusion of the compensation amount and the accident benefit amount in the principal value of the estate was not sustainable, and both amounts were not chargeable to estate duty.

---