Estate duty aggregation under a machinery provision failed constitutional equality review for lacking rational nexus with the charging section.

Section 34(1)(c) of the Estate Duty Act, 1953 was analysed as a rate-making machinery provision that aggregated the interests of lineal descendants with a deceased coparcener's interest for estate-duty purposes. The provision was found to create a discriminatory classification between coparceners dying with and without lineal descendants, because the descendants' interests in joint family property did not themselves pass, or deem to pass, on death under the charging provision. Since a machinery provision cannot enlarge the scope of the charge or bring non-taxable property into the rate base, the classification lacked rational nexus with the object of the levy and was held violative of article 14.

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Issues: Whether section 34(1)(c) of the Estate Duty Act, 1953, which directs aggregation of the interests of the lineal descendants of a deceased coparcener with the deceased's coparcenary interest for rate purposes, is violative of article 14 of the Constitution of India.

Analysis: The provision created a distinction between a coparcener dying leaving lineal descendants and other coparceners, and it imposed a higher estate-duty burden on the property passing on death where such descendants existed. The object of the Act was to levy estate duty on property passing on death on a graded basis, and the charging provision confined the levy to property actually passing or deemed to pass on death. The interests of the lineal descendants in joint family property were neither property passing on death nor deemed to pass on death under the Act. A machinery provision for aggregation could not enlarge the scope of the charging section or bring into charge property that did not pass on death. The classification therefore lacked a rational relation to the statutory object and resulted in discriminatory treatment.

Conclusion: Section 34(1)(c) was held to be discriminatory and violative of article 14, and its application to the assessment was quashed in favour of the petitioner.

Ratio Decidendi: A machinery provision cannot be used to include in the rate base property that neither passes nor is deemed to pass on death; a tax classification founded on such inclusion is unconstitutional unless it has a rational nexus with the charging provision and the object of the levy.

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