Executor assessment depends on completion of estate administration before any trust under the will comes into existence.

An executor remains assessable as executor until administration of the estate is complete and the residuary estate has been ascertained and vested in trustees. Where a will requires payment of funeral expenses, debts, estate duty and specific legacies before conversion of the remaining assets into cash and application to charitable objects, the trust does not arise until those steps are carried out. On the stated facts, probate, transfer of immovable properties, completion of payments and trust registration all occurred after the relevant assessment year, so the estate was still under administration and the income was taxable in the hands of the executors under the special provision applicable to executors rather than under representative assessee provisions.

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Issues: Whether the executors under the will had become trustees during the relevant assessment year so that the income was assessable under the representative assessee provisions, or whether the estate was still under administration and assessable in the hands of the executors under the special provision applicable to executors.

Analysis: The will required the executors first to discharge funeral expenses, debts, estate duty and specific legacies, then to convert the remaining properties into cash, and only thereafter to apply the residue for the charitable objects. The estate had not reached completion of administration during the relevant previous year: probate was granted only on 5 April 1963, the immovable properties were transferred later, the specific payments were completed only by February 1964, and the trust registration under the Bombay Public Trusts Act was also subsequent. The governing principle is that the character of an executor does not automatically cease on death or on probate; the decisive question is whether administration has been completed and the residuary estate has taken concrete shape so as to vest in trustees. On the facts, the trust was not yet in existence during the assessment year and the income remained income of the estate in the hands of the executors.

Conclusion: The executors were not assessable as trustees for the relevant year; the special provision dealing with executors applied, and the assessee's contention failed.

Ratio Decidendi: An executor continues to be assessable as executor until the administration of the estate is complete and the residuary estate has been ascertained and vested for the trust; a trust under a will comes into existence only when the testamentary directions for payment of liabilities and conversion of the estate into residue have been carried out.

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