TaxTMI 
TaxTMI 
1979 (12) TMI 16
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....is family comprised the following items : Rs. 1. General 1,15,514 2. Residential house property 1,40,000 ------------------ 2,55,514 3. Agricultural lands 36,840 4. 1/3 share of lands belonging to the Hindu undivided family of the deceased and his two brothers 5,120 5. 1/4 interest in the assets of a Hindu undivided family originally consisting of the deceased, his father and two brothers enlarged to 1/3 on the death of the father of the deceased on 14-10-1965 1,44,000 ------------------ 4,41,474 ------------------ The valuation of the last item has undergone modification. The Assistant Controller computed the principal value of the estate in the following manner. Rs. Half share of the deceased in the Hindu undivided family properties (1/2 of Rs. 4,41,474) 2,20,737 Rs. Less: Half share in dwelling house 70,000 Funeral expenses 1,000 71,000 ------------- ----------------- 1,49,737 Add: Share of lineal descendants in Hindu undivided family properties 2,20,737 Free estate 22,333 ----------------- 3,92,807 ----------------- The duty on Rs. 3,92,807 was calculated in accordance wi....
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....of such interest. The interest includes in particular coparcenary interest in the joint family property of an HUF governed by the Mitakshara, Marumakkattayam or Aliyasantana law. Where a Hindu coparcenary member governed by the Mitakshara School of law dies, s. 39 makes provision for the valuation of the interest in the coparcenary properties ceasing on death. Section 39(1), to the extent relevant, runs as follows: "The value of the benefit accruing or arising from the cesser of coparcenary interest in any joint family property governed by the Mitakshara school of Hindu law which ceases on the death of a member thereof shall be the principal value of the share in the joint family property which would have been allotted to the deceased had there been a partition immediately before his death ...... (3) For the purpose of estimating the principal value of the joint family property of a Hindu family governed by the Mitakshara ...... law, in order to arrive at the share which would have been allotted to the deceased had a partition taken place immediately before his death, the provisions of this Act, so far as may be, shall apply as they would have applied if the whole of the j....
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....n in the case of Devaki Ammal v. Asst. CED [1973] 91 ITR 24 and this court struck down s. 34(1)(c) as violative of art. 14 of the Constitution. The matter is now in appeal before the Supreme Court and the case is still pending. We have, therefore, for our present purpose to proceed on the basis that s. 34(1)(c) is not in the statute, though by reason of the matter being kept pending on appeal, the contention for the revenue is that the provision also would have to be worked out. Section 33(1)(n) is the only other provision, which requires consideration in the context of the accountable person's claim. That provision, in so far as it is material, runs as follows: " 33. (1) To the extent specified against each of the clauses in this sub-section, no estate duty shall be payable in respect of property of any of the following kinds belonging to the deceased which passes on his death-... (n) one house or part thereof exclusively used by the deceased for his residence to the extent the principal value thereof does not, exceed rupees one lakh if such house is situate in a place with a population exceeding ten thousand, and the full principal value thereof, in any other case." S....
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.... joint family properties came to Rs. 2,00,000, out of which the house property belonging to the joint family was valued at Rs. 1,70,000. That property was situate in the city of Madras with a population exceeding 10,000 and, therefore, the exemption available was only to the extent of Rs. one lakh. The Tribunal held that the exemption provided under s. 33(1)(n) should be allowed in computing the value of the HUF properties before determining the share of the deceased and also that of the lineal descendants, the former for assessment and the latter for aggregation. It is this conclusion of the Tribunal that was challenged before this court. For reasons mentioned in the said judgment, this court did not find it possible to answer the question referred and, therefore, sent the matter back. There is a discussion of the import of the provisions of the law. The learned standing counsel, Mr. Jayaraman, brought to our notice two passages in the said judgment, which according to him, create some difficulty in the interpretation of the provisions. At p. 205, it is observed: " The question is then whether in determining the value of the joint Hindu family properties, the properties ment....
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.... being only in respect of that property, nothing more than the value of the property can even be exempt...... It is, therefore, clear on the facts of the case that the extent of the exemption is only Rs. 85,000. " The difficulty pointed out by the learned counsel for the Commissioner was that if the exemption had to be granted as was indicated in the earlier passage, in arriving at the value of the joint family properties, then the accountable person would not be eligible for any further relief to the extent of Rs. 85,000 as was given in the said case. His point was that the relief could be worked out only at one stage. He wanted the relief to be worked out at the stage when the joint family properties are evaluated, and, according to him, there is no further scope for applying s. 33(1)(n). The two passages adverted to by the learned standing counsel do create some difficulty, as they do not appear to be harmonious. However, there is An indication of what the learned judges wanted to decide in that case and that is to be found at p. 205 in the portion following the first of the two extracts from the said judgment. The relevant passage runs as follows: " In the light of the....