Blending self-acquired property into family stock does not reduce disposal power; full value passes for estate duty.

Under Dayabhaga law, a Hindu can blend self-acquired property into the common stock of a Hindu undivided family, even where the family comprises a sole male member and his wife. The blending does not, however, make the wife a coparcener or divest the owner of disposing power over the property. For estate duty purposes, property is deemed to pass on death where the deceased was competent to dispose of it at the time of death. Accordingly, where the deceased remained the sole coparcener and retained full power of disposition, the entire value of the property was includible in the principal value of the estate, and inclusion of only 50 per cent was rejected.

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Issues: Whether the full value of the self-acquired property thrown into the common hotchpot of a Hindu undivided family governed by Dayabhaga law, of which the deceased was the sole coparcener and his wife the only other member, was includible in the principal value of the estate for estate duty purposes.

Analysis: A Hindu governed by Dayabhaga law can throw self-acquired property into the common stock of a Hindu undivided family, and the family may consist of a single male member with female members. However, the act of blending does not enlarge the rights of the wife so as to make her a coparcener in the situation under consideration, nor does it divest the deceased of the power to deal with the property as owner. Under the Estate Duty Act, property is deemed to pass on death if the deceased was competent to dispose of it at the time of death. The deceased, being the sole coparcener, retained full disposing power over the entire property, and the legal effect of blending did not reduce his interest to one-half.

Conclusion: The full value of the property was includible in the principal value of the estate and the contention for inclusion of only 50 per cent was rejected.

Final Conclusion: The estate duty assessment was upheld on the basis that the deceased remained competent to dispose of the whole property notwithstanding its inclusion in the family hotchpot, so the entire property was treated as passing on death.

Ratio Decidendi: Where a sole coparcener throws self-acquired property into the common stock of a Hindu undivided family, he remains competent to dispose of the entire property, and the whole value is deemed to pass on death for estate duty purposes.

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