Estate duty inclusion under section 10 turns on retained benefit in joint deposits, but not on a donee's separate firm deposit.

Joint fixed deposits made from gifts to minor daughters remained includible under section 10 of the Estate Duty Act, 1953 because the donor had not fully divested himself of the benefit, as the deposits and accrued interest were kept and renewed in joint names with him. The explanation that he held the amounts merely as guardian was rejected, since the joint deposit form was inconsistent with exclusive ownership by the minors. By contrast, a gift received by an adult son and deposited by him in the firm where the deceased was a partner did not, by that fact alone, attract section 10; the statutory conditions were not satisfied and the amount was excluded.

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Issues: (i) Whether cash gifts of Rs. 10,000 each made by the deceased to his minor daughters and placed in joint fixed deposits with the donor attracted section 10 of the Estate Duty Act, 1953; (ii) Whether the deposit made by the adult son out of a gift from the deceased in the firm where the deceased was a partner attracted section 10 of the Estate Duty Act, 1953.

Issue (i): Whether cash gifts of Rs. 10,000 each made by the deceased to his minor daughters and placed in joint fixed deposits with the donor attracted section 10 of the Estate Duty Act, 1953.

Analysis: The deposits were made in the joint names of the deceased and each daughter, with the amounts and accrued interest repeatedly renewed in the same joint form. The arrangement showed that the donor had not completely divested himself of the benefit in the manner required to exclude the property from the estate under section 10. The contention that the amounts were merely held by the deceased as guardian was not accepted, since the joint form of deposit was inconsistent with an exclusive deposit in the minors' names.

Conclusion: The inclusion of the amounts relating to the two minor daughters under section 10 was valid and the answer is against the accountable person.

Issue (ii): Whether the deposit made by the adult son out of a gift from the deceased in the firm where the deceased was a partner attracted section 10 of the Estate Duty Act, 1953.

Analysis: The sum gifted to the adult son was deposited by him in the firm in which the deceased was a partner. On the authority governing such cases, a deposit made by the donee in the business of the deceased does not, by itself, attract section 10 unless the statutory conditions are otherwise satisfied. The earlier Supreme Court rulings directly governed the question and excluded application of section 10 on these facts.

Conclusion: Section 10 was not attracted to this item and the answer is in favour of the accountable person.

Final Conclusion: The reference was answered by upholding the inclusion of the joint fixed deposits relating to the minor daughters, while rejecting the inclusion of the amount arising from the adult son's deposit in the firm.

Ratio Decidendi: For section 10 of the Estate Duty Act, 1953, a gift retained in joint deposit with the donor may remain within the estate if the donor has not fully parted with the associated benefit, whereas a deposit by an independent adult donee in the donor's firm does not, by that fact alone, satisfy the statutory conditions for inclusion.

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