1978 (3) TMI 6

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....e of the deceased, AR. RM. Umayal Achi, was not an admissible deduction in computing the principal value of the estate ? " The accountable person is one Sri RM. Arunachalam, who is the adopted son of Smt. AR. RM. Umayal Achi, who passed away on August 20, 1964. The accountable person is also the residuary legatee by the will dated July 20, 1961, executed by the said Umayal Achi. During the hearing of the appeal before the Tribunal, an additional ground was raised with the permission of the Tribunal, and it was contended on behalf of the appellant that immediately on the death of Umayal Achi taking place, the estate duty became a charge on the property and if the true market value of the estate had to be estimated under the provisions of ....

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....duty cannot be said to be an incumbrance, nor can it be said to have been created by the deceased, and, therefore, the estate duty was not deductible from the value of the estate passing on the death of the deceased. In support of her contention, the following decisions were relied upon, namely, (i) In re Mrs. Constance Lubeck [1970] 78 ITR 199 (Mad), (ii) Smt. Pramila v. CED [1975] 99 ITR 221 (Kar), (iii) CED v. Estate of Late Om Prakash Bajaj [1977] 110 ITR 263 (AP) and Smt. Shantaben Narottamdas v. CED [1978] 111 ITR 365 (Guj). In Pramila's case, a Division Bench of the Karnataka High Court, while considering the question about the determination of the value of the property passing on the death under the provisions of the Act, held th....

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....ion Act, 1955. In CED v. Estate of Late Om Prakash Bajaj [1977] 110 ITR 263, the Andhra Pradesh High Court took the view that the estate duty payable on an estate is not a " debt or incumbrance " within the meaning of s. 44 of the Act and, hence, it is not deductible while computing the principal value of the estate and that the liability for payment of the estate duty is a personal liability of the accountable person and not a liability of the estate itself and, hence, it cannot be said that it is a debt contemplated by s. 44 of the Act. The Gujarat High Court in Shantaben Narottamdas's case [1978] 111 ITR 365 had the opportunity of referring to the various decisions mentioned above except CED v. Estate of Late Om Prakash Bajaj while....