Estate duty withdrawals used for family and marriage expenses were not deemed gifts without proof of gratuitous transfer.

Withdrawals by the deceased that were supported by account details and shown to meet family and marriage expenses were not treated as deemed gifts for estate duty purposes. Because the record established identifiable expenditure on different dates rather than gratuitous transfers, the deeming provision did not apply. The addition based on deemed gifts was therefore unsustainable, and the deletion of the impugned addition was upheld.

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Issues: Whether withdrawals made by the deceased and handed over for expenses connected with family needs and marriage could be treated as deemed gifts liable to addition under the estate duty assessment.

Analysis: The withdrawals were supported by account details and were found to represent expenditure incurred on different dates for meeting expenses, including marriage-related outlay, rather than transfers constituting gifts. Since the material on record established expenditure and not gratuitous transfers, the deeming provision was held inapplicable.

Conclusion: The addition treating the withdrawals as deemed gifts was not sustainable and was rightly deleted.

Final Conclusion: The departmental appeal failed and the deletion of the impugned addition was upheld.

Ratio Decidendi: Withdrawals used for identifiable expenses, even if handed over to family members, do not amount to gifts unless a gratuitous transfer is established.

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