Estate duty valuation of land and factory buildings turns on objective market evidence and unrebutted valuer reports.

Estate duty valuation must be based on objective market material and comparable evidence. The land appurtenant to the factory premises was valued by reference to the earlier purchase price, Sub-Registrar market data and town planning rates, and the appellate authority's figure was upheld as reasonable. By contrast, the Department's enhanced construction cost estimate lacked comparable cases or a convincing basis, while the registered valuer's detailed report on the buildings and materials remained unrebutted, so the assessee's valuation of construction cost was accepted substantially.

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Issues: (i) Whether the value of the land appurtenant to the factory premises was correctly determined for estate duty purposes. (ii) Whether the cost of construction of the factory buildings and allied structures was correctly fixed for estate duty valuation.

Issue (i): Whether the value of the land appurtenant to the factory premises was correctly determined for estate duty purposes.

Analysis: The valuation had to reflect the fair market value on the relevant date, with due regard to comparable transactions and surrounding market indicators. The land values adopted by the accountable person were found inconsistent with the earlier purchase price, the Sub-Registrar's market data, and the town planning rate. The rate fixed by the appellate authority was considered reasonable on the available material.

Conclusion: The valuation of the land was upheld against the assessee.

Issue (ii): Whether the cost of construction of the factory buildings and allied structures was correctly fixed for estate duty valuation.

Analysis: The Department did not furnish comparable cases or a convincing basis for the enhanced rates adopted for construction. The registered valuer had given a detailed description of the buildings, showing the nature of construction, materials used, and the extent of finishing. On that footing, the rate adopted by the accountable person's valuer was held to be reasonable, and the consequent depreciation position was accepted, while the limited non-marketability adjustment was left undisturbed.

Conclusion: The cost of construction was accepted substantially as valued by the assessee.

Final Conclusion: The assessment was modified by sustaining the land valuation adopted by the appellate authority and by accepting the assessee's valuation of the construction cost, resulting in partial relief to the accountable person.

Ratio Decidendi: For estate duty valuation, land and building values must be fixed on objective market material and comparable evidence, and an enhanced departmental estimate cannot stand where it lacks supporting data while a detailed registered valuer's report remains unrebutted.

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