Estate duty assessment and discretionary interest levy: appeal maintainable, and interest excluded after early discharge of liability.

An appeal lies where an assessment order itself includes interest within the estate duty payable and the objection is directed to that composite determination; the challenge is therefore to the duty assessment, not to a standalone interest levy. Interest under the postponement provision was also not warranted on these facts because the statute authorised instalment payment and interest up to a maximum but prescribed no minimum, and the provisional demand was fully discharged before the first instalment fell due. The interest component was to be excluded from the duty payable, with consequential refund of any excess amount paid.

---

---

Issues: (i) Whether an appeal lay against the assessment order insofar as it included interest in the amount shown as estate duty payable; (ii) Whether interest under the postponement provision was leviable on the facts when the provisional demand was fully discharged before the first instalment fell due.

Issue (i): Whether an appeal lay against the assessment order insofar as it included interest in the amount shown as estate duty payable.

Analysis: The assessment order itself treated the sum as estate duty payable and the accountable person specifically objected to the inclusion of interest within that figure. On that footing, the challenge was directed against the order determining the duty payable, and not merely against an isolated levy of interest divorced from the assessment.

Conclusion: The appeal was maintainable, and the summary dismissal in limine was not justified.

Issue (ii): Whether interest under the postponement provision was leviable on the facts when the provisional demand was fully discharged before the first instalment fell due.

Analysis: The postponement provision conferred discretion to allow payment by instalments and to impose interest up to a prescribed maximum, but it did not prescribe any minimum rate. The amount due was paid in full before the first instalment date, and the liquidation was effected only by early encashment of assets, which involved financial sacrifice to the estate. In those circumstances, the levy of interest was held to be unnecessary.

Conclusion: Interest ought not to have been charged, and the amount of interest was directed to be excluded from the duty payable.

Final Conclusion: The assessee succeeded both on maintainability and on merits, and the interest component was directed to be removed from the assessment with consequential refund of any excess paid.

Ratio Decidendi: Where the assessment order itself shows an amount as estate duty payable and the objection is to the inclusion of interest in that figure, an appeal lies against the order determining the duty payable; further, where the statute confers discretion to levy interest up to a maximum but no minimum is prescribed, interest need not be charged if the liability is fully discharged before the instalment schedule actually becomes operative.

---