Advocates Appeared: BHAVESH P.TRIVEDI, J.M.THAKAR, K.A.Mehta, N.U.RAVAL, R.P.BHATT

The legal document discusses the assessment of income tax on the estate of a deceased person who had executed two separate wills for properties located in different countries. The key legal principles are as follows:

1. Single Estate Concept: Despite the existence of two wills and separate sets of executors, the estate of the deceased remains one indivisible entity. The law recognizes the estate as the totality of the deceased’s property, and the appointment of different executors for different parts does not create separate estates. Instead, all such executors are considered the legal representatives of a single, unified estate (!) (!) .

2. Assessment of Income: The income of the deceased’s estate during the period from death to complete distribution is assessable in the hands of the executors as if they were an association of persons. The income from the entire estate, whether within or outside the country, can be clubbed and taxed collectively in a single assessment against the executors (!) .

3. Executors’ Role and Powers: Executors hold the estate in a fiduciary capacity, and their powers include administering, managing, and distributing the estate’s assets. They may act independently or jointly, but their collective interest is in the estate as a whole. Their interest is in representing the estate, not in owning the property outright, and they may become trustees upon completion of administration (!) (!) (!) .

4. Taxation of Income: The assessment machinery provides that income of the estate is taxable in the hands of the executors, whether there is one or multiple. When there are multiple executors, they are deemed to act as an association of persons for taxation purposes, and the income from the estate can be aggregated and taxed collectively (!) .

5. Assessment Procedures: The law prescribes that assessments are to be made on the total income of the estate for each completed previous year. If the administration is complete, the executor’s role ceases, and the estate’s income is no longer assessable under this section. The assessment is primarily concerned with income accrued during the period of estate administration, not income received after the estate has been fully administered (!) (!) .

6. Implication of Multiple Wills and Executors: The existence of separate wills and appointing different sets of executors for properties in different jurisdictions does not create separate estates for tax purposes. The entire property of the deceased is regarded as one estate, and the income from all parts of this estate can be assessed collectively. The law does not recognize the division of estate into separate taxable entities solely because of different wills or executors (!) (!) .

7. Legal Personality of the Estate: The estate itself does not have a separate legal personality; instead, the estate’s rights and liabilities are represented through the executors. The estate’s income and assets are administered by the executors, who act as the legal representatives of the estate during the administration period (!) (!) .

In summary, the legal principles emphasize that the estate of a deceased person remains a single, indivisible entity for tax purposes, regardless of the number of wills or sets of executors appointed for different properties. All income from the estate, whether domestic or foreign, can be collectively assessed in the hands of the executors acting as a single entity.