Partition rights and signed book entries: ownership requires actual allotment, while a written gift can validly transfer an actionable claim.

On partition of Hindu family property, a wife's right to claim a share does not by itself create ownership in property until an actual allotment is made and possession is given; on that basis, property standing in the deceased's name was treated as passing on death under the Estate Duty Act. The document also notes that a gift effected by debit and credit entries in account books, signed by the donor and guardians, can constitute a valid transfer where intention to transfer is clear and the statutory requirement of writing is met. Such a transfer of money or an actionable claim was treated as taking effect more than two years before death and excluded from the estate.

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Issues: (i) Whether, on a partition of Hindu family property, the wife of the deceased had acquired such an ownership interest in the properties allotted to the deceased that only a half share could be treated as passing on his death under section 7 of the Estate Duty Act, 1953. (ii) Whether the sum of Rs. 80,000 standing in the names of the grandchildren was a validly completed gift and, if so, whether it was liable to be included in the deceased's estate under the estate duty law.

Issue (i): Whether, on a partition of Hindu family property, the wife of the deceased had acquired such an ownership interest in the properties allotted to the deceased that only a half share could be treated as passing on his death under section 7 of the Estate Duty Act, 1953.

Analysis: The partition in 1936 did not allot any separate share to the wife, and the legal position discussed showed that a wife or mother does not become owner of any share merely because of severance of the joint family status. Her right, where it exists, is to claim a partition and obtain an allotment, but until property is actually allotted and possession is given, she does not acquire ownership in the property itself. On either view, whether she acquiesced in the partition or retained a right to reopen it, she was not shown to be owner of any part of the property standing in the deceased's name at his death.

Conclusion: The entire property standing in the deceased's name passed on his death and was rightly included under section 7; the finding is against the assessee and in favour of the revenue.

Issue (ii): Whether the sum of Rs. 80,000 standing in the names of the grandchildren was a validly completed gift and, if so, whether it was liable to be included in the deceased's estate under the estate duty law.

Analysis: The gift was effected by debit entries in the donor's account and corresponding credit entries in the accounts of the minors, signed by the donor and their guardians. Such entries were sufficient to evidence an intention to transfer and, in the circumstances, constituted a valid transfer. The transaction also satisfied the requirement of an instrument in writing for transfer of an actionable claim, and there was no legal basis for insisting on a registered instrument. The transfer therefore took effect more than two years before death.

Conclusion: The amount of Rs. 80,000 was not liable to be included in the estate; the finding is against the revenue and in favour of the assessee.

Final Conclusion: The reference was answered by sustaining inclusion of the entire property in the estate on the first question and excluding the Rs. 80,000 gift amount on the second, with each side succeeding on one issue.

Ratio Decidendi: A spouse who has not been actually allotted property on partition does not acquire ownership merely from a notional right to claim partition, and a gift of money or an actionable claim can be validly effected by signed book entries when the intention to transfer is clear and the statutory requirement of writing is satisfied.

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