ESTATE DUTY ACT, 1953
(1) This act may be called the Estate Duty act, 1953.
(2) It extends to the whole of India except the State of Jammu and Kashmir.
(3) It shall come into force on such date as the Central Government may by notification in the Official Gazette, appoint.
In this Act, unless the context otherwise requires,.-
(1) "affidavit of valuation" means the affidavit of valuation made under section 19-1 of the Court-fees act, 1870 (VII of 1870) , in connection with an application for the grant of representation;
(2) "Board" means the Central Board of revenue constituted under the Central Board of Revenue Act, 1924 (IV of 1924) ;
(3) "company" includes anybody corporate wheresoever incorporated;
(4) "controlled company" means a company as defined in section 17:
(5) "Controller" means a person appointed to be a Controller of Estate Duty under section 4 and includes a person appointed to be a Deputy Controller of Estate Duty or an Assistant controller of Estate Duty;
(1) For the purposes of this Act,.-
(a) a person shall be deemed competent to dispose of property if he has such an estate or interest therein or such general power as would, if he were sui juris enable him to dispose of the property;
(b) a disposition taking effect out of the interest of the deceased shall be deemed to have been made by him, whether the concurrence, of any other person was or was no required;
(c) money which a person has a general power to charge on the property of another person shall be deemed to be an interest in that property of which the former has power to dispose;
(d) the domicile of a person shall be determined as if the provisions of the Indian Succession Act, 1925 (XXXIX of 1925) on the subject applied to him.
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(1) There shall be the following authorised for the purposes of this Act, namely :.-
(a) the Board,
(b) Controllers of Estate Duty.
(c) Valuers.
(2) The Central government may appoint as many Controllers of state Duty as it thinks fit and they shall, subject to the control of the board, perform their functions in respect of such estates or classes of states and such areas as are assigned to them by the Board :
Provided that, subject to such rules as may be made by the Board in the behalf, ever Controller, within the local limits of whose jurisdiction of any part of the estate of the deceased is situated, may exercise in ...........to the whole estate or any part thereof any of the powers con......on the C
(1) In the case of every person dying after the commencement of this Act, there shall, save as hereinafter expressed provided, be levied and paid upon the principal value ascertained hereinafter provided of all property, settled or not settled, including agricultural land situate in the States specified in the first Schedule of this Act, which passes on the death of such person, a duty called estate duty" at the rates fixed in accordance with section 35.
(2) The Central Government may, by notification in the Official Gazette, add the names of any other States to the First Schedule in respect whereof resolutions have been passed by the Legislatures of those states adopting this Act under clause (1) of article 252 of the constitutions respect of estate duty on agricultural lands situate in those States, and on the issue of any such notification the States so added shall be deemed to
Property which the decease was at the time of his death competent to dispose of shall be deemed pass on his death.
(1) subject to the provisions of the section, property in which the deceased or any other person had interest ceasing on the death of the deceased shall be deemed to pass the deceased's death to the extent to which a benefit accrues or area by the cesser of such interest, including, in particular, a coparcenary interest in the joint family property of a Hindu family governed by the Mitakshara, Marumakkattayam or Aliyasantana law.
(2) If a member of a Hindu coparcenary governed by the Mitaksha school of law dies, then the provisions of sub-section (1) shall apply with respect to the interest of the deceased in the coparcenary property only-
(a) if the deceased had completed his eighteenth year at the time of his death, or
(b) where he had not completed his eighteenth year at the time of his dea
mortis causa, .- Property taken as a gift made in contemplation of death shall be deemed to pass on the donor's death.
Explanation -.In this section, the expression "gift made in contemplation of death" has the same meaning as in section 191 of the Indian succession Act, 1925, (XXXIX of 1925) .
(1) Property taken under the disposition made by the deceased purporting to operate as an immediate gift inter vivas whether by way of transfer, delivery, declaration of trust, settlement upon persons in succession, or otherwise, which shall not have been bona fide made two years or more before the death of the deceased shall be deemed to pass on the death:
Provided that in the case of gifts made for public charitable purposes the period shall be six months.
(2) The provisions of sub-section (1) shall not apply to gifts made in consideration of marriage or which are proved to the satisfaction of the Controller to have been part of the normal expenditure of the deceased, but not exceeding rupees five thousand in the aggregate.
Property taken under any gift, whenever made, shall be deemed to pass on the donor's death to the extent that bona fide possession and enjoyment of it was not immediately assumed by the donee and thenceforward retained to the entire exclusion of the donor or of any benefit to him by contract or otherwise:
Provided that the property shall not be deemed to pass by reason only that it was, not, as from the date of the gift, exclusively retained as aforesaid, it is subsequently enjoyed to the entire exclusion of the donor or of any benefit to him for at least two years before the death.
(1) subject to the provisions of this Section, whether an interest Limited to cease on a death has been disposed of or has determined, whether by surrender, assurance, divesting, forfeiture or in any other manner (except by the expiration of a fixed period at the expiration of which the interest was limited to cease) , whether wholly or partly, and whether for value or not, after becoming an interest in possession, and the disposition or determination (or any of them if there are more than one) is not excepted by sub-section (2) , then .-
(a) if, had there been no disposition or determination, as aforesaid of that interest and no disposition of any interest expectant upon or subject to that interest, the property in which the interest subsisted would have passed on the death under section 5, that property shall be deemed by virtue of this section to be included as to the whole ther
(1) Property passing under any settlement made by the deceased by deed or any other instrument not taking effect as a will whereby an interest in such property for life or any other period determinable by reference to death is reserved either expressed to himself the right by the exercise of any power, to restore to himself or to reclaim the absolute interest in such property shall be deemed to pass on the settlor's death:
Provided that the property shall not be deemed to pass on the settlor's death by reason only that any such interest or right was so reserved, if by means of the surrender of such interest or right the property is subsequently enjoyed to the entire exclusion of the settlor and of any benefit to him by contract or otherwise, for at least two years before his death.
Explanation.- A settlor reserving an interest in the set
Where a person, having been absolutely entitled to any property or to the funds with which any property was purchased, has caused it to be transferred to or vested in himself and any self alone, or in concert, or by arrangement, with any other person so that the beneficial interest in some part of that property passes or accrues by survivorship on his death to the other person, the whole of that property shall be deemed to pass on the death.
(1) Money received under a policy of insurance effected by any person on his life, where the policy is wholly kept up by him for the benefit of a donee, whether nominee or assignee, or a part of such money in proportion to the premiums paid by him, where the policy is partially kept up by him for such benefit, shall be deemed to pass on the death of the assured.
Explanation .- A policy of insurance on the life of a deceased person effected by virtue or in consequence of a settlement made by the deceased shall be treated as having been effected by the deceased.
(2) For the purposes of sub-section (1) , so much of the premiums paid on any policy of insurance as was, by virtue or in consequence of a settlement made by the deceased, paid out of property, whether or not provided by the deceased comprised in the settlement or out of income, wh
Any annuity or other interest, purchased or provided by the deceased, either by himself, alone or in concert or by arrangement with any other person shall be deemed to pass on his death to the extent of the beneficial interest accruing or arising, by survivorship or otherwise, on his death.
Explanation.- The extent of the beneficial interest must be ascertained without regard to any interest by expectancy which the beneficiary may have had therein before the death.
(1) Section 15 shall have effect in relation to any annuity or other interest that was purchased or provided wholly or in part by any person who was at any time entitled to or amongst whose resources there was at any time included, any property derived from the deceased, or, if it is proved to the satisfaction of the Controller that the application of all the property derived from the deceased would have been insufficient to provide the whole of that annuity or other interest, as if a similar annuity or interest of an amount reduced to an extent proportionate to the insufficiency proved had been provided by the deceased.
Provided that for the purpose of determining whether there would have been any such insufficiency as aforesaid, and the extent thereof, there shall be excluded from the property derived from the deceased any part thereof as to which it is proved to the satisfaction
(1) Where the deceased has made to a controlled company a transfer of any property (other than an interest limited up cease on his death or property which he transferred in a fiduciary capacity) , and any benefits accruing to the deceased from the company accrued to him in the three years ending with his death, the assets of the company shall be deemed for the purposes of estate duty to be included in the property passing on his death to an extent determined in accordance with sub-section (2) .
(2) The extent to which the assets of the company are to be deemed to be included as aforesaid shall be the proportion ascertained by comparing the aggregate amount of the benefits accruing to the deceased from the company in the last three accounting years with the aggregate amount of the net income of the company for the said years:
Provided tha
(1) Where the deceased has made a transfer of property to controlled company, the company shall be under obligation in inform the Controller within forty-five days from the date of the death of the deceased, of the death, of the fact that the deceased made a transfer of property to the company, and of the fact that benefits accrued to the deceased from the company, and every person who was a principal officer of the company at that date, or if the company has been wound up and dissolved before that date, who was a principal officer of the company at any time and who has been called upon to furnish any information under this section, shall be under the like obligation as respects such of the facts aforesaid as are within his knowledge, unless he knows, or has reasonable cause for believing, that this informing in question has already been given to the Controller by the company or some other person.
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(1) The following persons shall be accountable for the duty payable on the death of the deceased by virtue of section 17, namely:.-
(a) the company;
(b) any person (other than a bona fide purchaser for full consideration in money or money's worth received by the company for its own use and benefit) who receives, whether directly from the company or otherwise, or disposes of, any assets which the company had, whether as capital or as income, at the death or at any time thereafter;
(c) any person who received distributed assets of the company on their distribution
Provided that a person shall not,.-
(i) by virtue of clause (b) , be accountable in respect of any assets of any duty in excess of the value of t
(1) The Board may make rules.-
(a) prescribing the class of dispositions or operations which shall be deemed to be transfers to controlled companies, within the meaning of section 17;
(b) prescribing the matters to be treated as benefits accruing to the deceased from any such controlled company, the manner is which there amount is to be determined, and the time at which they are to be treated as accruing;
(c) prescribing the manner in which the net income and the value of the assets of any such company are to be determined;
(d) prescribing the manner in which the accounting year of any such company is to be reckoned;
(e) prescribing the manner in which the shares and debentures of any such company passing
(1) There shall not be including in the property passing on the death of the deceased.-
(a) immovable property situated outside the territories to which this Act extends;
(b) movable property situated outside the territories to which this Act extends at the time of the death unless.-
(i) in the case of any property, whether settled or not, the deceased was domiciled in the said territories at the time of this death; or
(ii) in the case of settled property of which the deceased was a life tenant, the settler was domiciled in the said territories at the date the settlement took effect.
(2) The Board may make rules regulating the manner in which the nature and locality of different classes of assets shall be
Property passing on the death of the deceased shall not be deemed to include property held by the deceased as trustee for another person under the disposition not made by the deceased or under a disposition made by the deceased where (whether by virtue of the original disposition or of a subsequent surrender of any benefit originally reserved to the deceased or otherwise possession any enjoyment of the property was bona fide assumed by the beneficiary at least two years before the death and thenceforward retained by him to the entire exclusion of the deceased or of any benefit to the deceased by contract or otherwise;
Provided that in the case of property held by the deceased as sole trustee for another person under a disposition made by himself, the period shall be five years.
In the case of settled property where the interest of any person under the settlement fails or determines by reason of his death before it becomes an interest in possession, and one or more subsequent limitations under the settlement continue to subsist, the property shall not be deemed to pass on his death by reason only of the failure or determination of that interest.
Explanation 1.- Where property is settled by a person on himself for life and after his death on any other person, with an ultimate reversion of an absolute interest or absolute power of disposition to the settlor, the property shall not be deemed to pass to the settlor on the death of such other person by reason only that the settlor being then in possession of the property as tenant for life becomes, in consequence of such death, entitled to the immediate reversion or acquires an absolute power to dispose of the
(1) Where by a disposition of any property an interest is conferred on any person, other than the disponer for the life of such person or determinable on his death, the remainder being conferred upon the disponer absolutely, and such person enters into possession o the interest, and thenceforward retains possession of it, then, on the death of such person, the property shall not be deemed to pass by reason only of its reverter to the disponer in his life time.
(2) Where by a disposition of any property any such interest as is mentioned in sub-section (1) is conferred on two or more persons either severally or jointly or in succession, sub-section (1) shall apply in like manner as where the interest is conferred on one person :
Provided that sub-section (1) shall not apply where such person or persons taking the said life or determinable
Where a husband or wife is entitled, either solely or jointly with the other, to the income of any property settled by the other under a disposition which took effect before the commencement of this Act and on his or her death the survivor becomes entitled to the income of the property (as distinguished form the property itself) settled by such survivor, estate duty shall not be payable in respect of that property until the death of that survivor.
(1) Subject to the provisions of section 27 and section 46 estate duty shall not be payable in respect of property passing on the death of the deceased by reason only of bona fide purchase from the person under whose disposition the property passes, nor in nor in respect of the determination of any annuity for lives, where such purchase was made, or such lease or annuity granted, for full consideration in money or money's worth paid to the vendor or grantor for his own use or benefit, or in the case of a lease from the use or benefit of any person from whom the grantor was a trustee.
(2) Where any such purchase was made, or lease or annuity granted for partial consideration in money or money's worth paid to the vendor or grantor for his own use or benefit, or in the case of a lease for the use or benefit of any person for whom the grantor was a trustee, the value of the considerati
(1) Any disposition made by the deceased in favour of a relative of his shall be treated for the purposes of section 9 as a gift unless.-
(a) the disposition was made on the part of the deceased for full consideration in money or money's worth paid to him for his own use or benefit; or
(b) the deceased was concerned in a fiduciary capacity imposed on him otherwise than by a disposition made by him and in such a capacity only ; and references to a gift in this Act shall be construed accordingly :
Provided that where the disposition was made on the part of the deceased for partial consideration in money or money's worth paid to him for his own use or benefit, the value of the consideration shall be allowed as a deduction from the value of the property for the purpose of estate duty.
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Where an interest in expectancy in any property has whether before or after the commencement of this Act, been bona fide sold or mortgaged for full consideration in money or money's worth, and the rates of estate duty in force in the case of a person dying when the interest falls into possession are higher than the rates in force, if any, in the case of a person dying at the time of the sale or mortgage, then.-
(a) no other duty on that property shall be payable by the purchaser or mortgagee when the interest falls into possession than the duty, if any, which would have been payable if the rates of estate duty applicable had been the rates in force, if any, in the case of a person dying at the time of the sale, or mortgage, and
(b) in the case of a mortgage, any higher duty payable by the mortgagor shall rank as a charge subsequent to th
If estate duty has already been paid in respect of any settled property since the date of the settlement, on the death of one of the parties to a marriage the estate duty shall not be death of one of the parties to a marriage the estate duty shall not be payable in respect thereof on the death of the other party to the marriage, unless the latter was at the time of his death, or had been at any time during the continuance of the settlement, competent to dispose of such property, and, if on his death subsequent limitations under the settlement take effect in respect of such property, was sui juris at the time of his death, or had been sui juris at any time while so competent to dispose of the property.
The Central Government may enter into an agreement with the Government of any reciprocating country for the avoidance or relief of double taxation with respect to estate duty leviable under this Act and under the corresponding law in force in the reciprocating country and may, by notification in the Official Gazette, make such provision as may be necessary for implementing the agreement.
Explanation.- The expression "reciprocating country" for the purpose of this Act means any country which the Central Government may, by notification in the Official Gazette, declare to be a reciprocating country.
Where the Board is satisfied that estate duty has become payable on any property passing upon the death of any person, and that subsequently within five years estate duty has again become payable on the same property or any part thereof passing on the death of the person to whom the property passed on the first death, the amount of estate duty payable on the second death in respect of the property so passing shall be reduced as follows :.-
Where the second death occurs within one year of the first death, by fifty per cent ;
Where the second death occurs within two years of the first death, by forty per cent ;
Where the second death occurs within three years of the first death, by thirty per cent.;
Where the second death occurs within four years of t
Where on the death of any person governed by any school of Hindu law, his interest in any property has devolved on his widow, then, if the widow dies within seven years of her husband's death and the interest aforesaid devolves upon the reversioners or any of them, no estate duty shall be leviable in respect of the passing of the interest aforesaid on the death of the widow, if and in so far as estate duty had been paid in respect of the passing of such interest on the death of her husband.
(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.-
(a) property taken under a gift made by the deceased for a public charitable purpose within a period of six months before his death, to the extent of rupees two thousand and five hundred in value ;
(b) property taken under a gift made by the deceased for any other purpose within a period of two years before his death, to the extent of rupees one thousand and five hundred in value :
(c) household goods, including tools of artisans, agricultural implements or any other tools or implements as were necessary to the deceased to enable him to earn his livelihood, to the extent of rupees
(1) For determining the rate of estate duty to be paid on any property passing on the death of the deceased, all property so passing, excluding.-
property exempted from duty under clauses (c) , (d) , (e) , (i) and (j) of sub.- section (1) of section 33.
but including.-
(i) property on which no estate duty is leviable under section 35,
(ii) property exempted from duty under clauses (a) , (b) , (f) , (g) , (h) and (k) of section 33, and
(iii) agricultural land situate in any State not specified in the First Schedule,
shall be aggregated so as to form one estate and the duty shall be levied at the rate of rates applicable in respect of the principal value thereof
(1) The rates of estate duty shall be as mentioned in the Second Schedule :
Provided that no such duty shall be levied upon.-
(a) property which consists of an interest in the joint family property of a Hindu family governed by the Mitakshara, Marumakkattayam or Aliayasantana law, to the extent to which the principal value of the estate does not exceed rupees fifty thousand ;
(b) property of any other kind, to the extent to which the principal value of the estate does not exceed rupees one lakh.
(2) Where an estate passing on the death of a person consist partly of property of the nature described in clause (a) of the proviso to sub-section (1) and party of the nature described in clause (b) of the said proviso, the estate duty payable thereon shall
(1) The principal value of any property shall be estimated to be the price which, in the opinion of the Controller it would fetch if sold in the open market at the time of the deceased's death.
(2) In estimating the principal value under this section the Controller shall fix the price of the property according to the market price at the time of the deceased's death and shall not make any reduction in the estimate on account of the estimate being made on the assumption that the whole property is to be placed on the market at one and the same time :
Provided that where it is proved to the satisfaction of the Controller that the value of the property has depreciated by reason of the death of the deceased, the depreciation shall be taken into account in fixing the price.
Where the articles of association of a private company contain restrictive provisions as to the alienation of shares, the value of the shares, if not ascertainable by reference to the value of the total assets of the company, shall be estimated to be what they would fetch if they could be sold in the open market on the terms of the purchaser being entitled to be registered as holder subject to the articles, but the fact that a special buyer would for his own special reasons give a higher price than the price in the open market shall be disregarded.
Where an estate includes an interest in expectancy, estate duty in respect of that interest shall be paid, at the option of the person accountable for the duty, either with the duty in respect of the rest of the estate or when the interest falls into possession, and if the duty is not paid with the estate duty in respect of the rest of the estate, then.-
(a) for the purpose of determining the rate of estate duty in respect of the rest of the estate, the value of the interest shall be its value at the date of the death of the deceased ; and
(b) the rate of estate duty in respect of the interest when in falls into possession shall be calculated according to its value when it falls into possession, together with the value of the rest of the estate as previously ascertained.
(1) The value of the benefit accruing or arising from the cesser of a 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.
(2) The value of the benefit accruing or arising from the cesser of an interest in the property of a tarwad or tavazhi governed by the Marumakkattayam rule of inheritance or of a kutumba or kavaru governed by the Aliyasantana rule of inheritance which ceases on the death of a member thereof shall be the principal value of the share in the property of the tarawd or tavazhi or, as the case may be, the kutumba or kavaru which would have been allotted to the deceased had a partition taken place immediatel
The value of the benefit accruing or arising or arising from the cesser of an interest ceasing on the death of the deceased shall.-
(a) if the interest extended to the whole income of the property, be the principal value of that property ; and
(b) if the interest extended to less than the whole income of the property, be the principal value of an addition to the property equal of the income to which the interest extended.
Subject to the provisions of this Act, the value of any property for the purpose of estate duty shall be ascertained by the Controller in such manner and by such means as may be prescribed and if he authorises a person to inspect any property and to report the value thereof for the purposes of this act, that person may enter upon the property and inspect it at such reasonable times as may be prescribed.
Where the Controller requires any person to report on the value of any property for the purposes of this Act, the reasonable costs of such valuation shall be defrayed by the Controller.
The Controller on application from a person accountable for the duty on any property forming part of an estate shall, where he considers that if can conveniently be done, certify the amount of the valuation accepted by him for any class or description of property forming part of such estate.
In determining the value of an estate for the purpose of estate duty, allowance shall be made for funeral expenses (not exceeding rupees one thousand) and for debts and incumbrances; but an allowance shall not be made.-
(a) for debts incurred by the deceased, or incumbrances created by a disposition made by the deceased, unless, subject to the provisions of section 27, such debts or incumbrances were incurred or created bona fide for full consideration in money or money's worth wholly for the deceased's own use and benefit and take effect out of his interest, or
(b) for any debt in respect whereof there is right to reimbursement from any other estate or person, unless such reimbursement cannot be obtained or
(c) more than once for the same debt or incumbrance charged upon different portions of
Where a debt or incumbracne has been incurred or created in whole or in part for the purpose of or in consideration for the purchase or acquisition or extinction, whether by operation of law or otherwise of any interest in expectancy in any property passing or deemed to pass on the death of the deceased and any person whose interest in expectancy is so purchased, acquired, or extinguished becomes (under any disposition made by or through devolution of law from, or under the intestacy of the deceased) entitled to any interest in that property, then in determining the value of the estate of the deceased for the purpose of estate duty no allowance shall be made in respect of such debt or incumbrance, and any property charged with any such debt incumbrance shall be deemed to pass freed from that debt or incumbrance:
Provided that.-
(a) if pa
(1) Any allowance which, but for this provision, would be made under section 44 for a debt incurred by the deceased as mentioned include (a) of that section or for an incumbrance created by a disposition made by the deceased as therein mentioned, shall be subject to abatement to an extent proportionate to the value of any of the consideration given therefor which consisted of.-
(a) property derived from the deceased; or
(b) consideration not being such property as aforesaid, but given by any person who was at any time entitled to or amongst whose resources there was a t any time included, any property derived from the deceased;
Provided that if, where the whole or a part of the consideration give consisted of such consideration as is mentioned in clause(b) of this sub-section it is proved to t
An allowance shall not be made in the first instance for debts due from the deceased to persons resident out of the territories to which this act extends (unless contracted to be paid in the said territories or charged on properties situate within the said territories) ,except, out of the value of any property of the deceased situate out of the said territories in respect of which estate duty is paid; and there shall be no repayment of estate duty in respect of any such debts, except to the extent to which it is shown to the satisfaction of the Controller that the property of the deceased situate in the foreign country in which the person to whom such debts are due resides is insufficient for their payment.
Where the Controller is satisfied that any additional expense in administering or in realising property has been incurred by reason of the property being situate out of the territories to which this Act extends he may make an allowance from the value of the property on account of such expense not exceeding in any case five percent or the value of the property.
Where any property passing on the death of the deceased is situate in a non-reciprocating country and the Controller is satisfied that by reason of such death any duty is payable in that country in respect of that property, he may, subject to such rules as may be made by the Board in the behalf, make an allowance of the whole or any part of the amount of that duty form the value of the property.
Explanation.- In this section, the expression "non-reciprocating country" means any country other than India which has not been declared to be a reciprocating country for the purposes of this Act.
Where any fees have been paid under any law relating to court-fees in force in any State other than the State of Jammu and Kashmir for obtaining probate, letters, of administration or a succession certificate in respect of any property on which estate duty is leviable under this Act, the amount of the estate duty pay7able shall be reduced by an amount which is equal to the court-fees so paid.
Estate duty may be collected by such means and in such manner as the Board may prescribe.
The Board may prescribed that Government securities shall be accepted in payment of estate duty on such terms as it thinks fit.
(1) Where any property passes on the death of the deceased.-
(a) every legal representative to whom such property so passes for any beneficial interest in possession or in whom any interest in the property so passing is at any time vested,
(b) every trustee, guardian, committee or other person in whom any interest in the property so passing or the management thereof is at any time vested, and
(c) every person in whom any interest in the property so passing is vested in possession by allegation or other derivative title,
shall be accountable for the whole of the estate duty on the property passing on the death but shall not be liable for any duty, in excess of the assets of the deceased which he actually received or which, but for his own neglect or
(1) Where an interest limited to cease on a death within the meaning of section 11 after becoming an interest in possession is disposed of or determines wholly or partly then whatever the nature of the property in which the interest subsisted, the following persons shall be accountable for any estate duty payable on the death by virtue of that section (in addition to any persons accountable therefor apart form this section ) , that is to say.-
(a) if the settlement under which the interest subsisted is in existence at the death, the trustees for the time being of that settlement; and
(b) if it is not, the persons who were the last trustees of that settlement.
(2) Where.-
(a) the trustees of a settlement may become accountable for estate duty payable
Every person accountable for estate duty, every company to which, in the opinion of the Controller, a transfer of property has been made by the deceased as mentioned in section 17, every person who is or was at any time an officer or auditor of such a company, and every person whom the Controller believes to have taken possession of or administered any part of the estate in respect of which duty is leviable on the death of the deceased, or of the income of any part of such estate shall, if required by the Controller, deliver to him and verify to the best of his knowledge, and belief, a statement of such particulars together with such accounts, documents, evidence or information as the controller may require relating to any property which he has reason to believe to from part of an estate in respect of which estate duty is leviable on the death of the deceased.
Any person who without reasonable cause has failed to comply with the provisions of section 53 or section 55, or has failed to comply with the said provisions within the time allowed, shall be liable to pay a penalty of one thousand rupees or a sum equal to double the amount of estate duty, if any remaining unpaid for which he is account able according as the Controller may direct:
Provided that the Controller may reduce the penalty in any particular case.
In all cases in which a grant of representation is applied of within six months of the death of the deceased.-
(a) the executor of the deceased shall, to the best of his knowledge and belief, specify in an appropriate account annexed to the affidavit of valuation filed in court under section 19-I of the court-fees Act, 1870 (VII of 1870) all the property in respect of which estate duty is payable upon the death of the deceased and shall deliver a copy of the affidavit with the account to the Controller and
(b) no order entitling the applicant to the grant of representation shall be made upon his application until he has delivered the account prescribed in clause (a) and has produced a certificate from the Controller under section 60 or section 67 that the estate duty payable in respect of the property included in the account has been or
(1) Estate duty shall be due from the date of the death of the deceased and shall be collected upon the account delivered under section 53 or clause (a) of section 57 or the account prepared under sub.- section (2) of section 61.
(2) When any estate duty, penalty interest or any other sum chargeable under this act has bee determined in consequence of any order passed under or in pursuance of this act, the Controller shall serve on the person accountable a notice of demand in the prescribed form specifying the sum so payable and the time which and the place at which it is payable.
No proceeding for the levy of any estate duty under this Act shall be commenced after the expiration of twelve years from the date of death of the deceased in respect of whose property estate duty became leviable.
Upon delivery of the account under section 53 or clause (a) of section 57, the person delivering it shall pay to the Controller or furnish security to the satisfaction of the Controller for the payment of the state duty, if any payable in respect of the property included in the account and the Controller shall thereupon grant him a certificate that such duty has been or w8ill be paid or that none is due as the case may be.
(1) If the Controller is of opinion that the person delivering the account has under-estimated the value of the property in respect of which estate duty is payable (whether by placing too low a value on the property included in the account or by omitting to include therein property that ought to have been included) , the Controller may inquire into the matter in such manner and by such means as he thinks fit and if still of opinion that the value of the property has been under-estimated may required him to amend the valuation, and if that person does not amend the valuation to the satisfaction of the Controller, the Controller may determine the valuation on the basis of which estate duty is payable after giving the person accountable an opportunity of being heard.
(2) In any case where no account has been delivered as required by section 53 or clause (a) of section 57, the Controll
(1) If, after the determination of the estate duty payable in respect of any estate, it appears to the Controller, that by reason of any mistake apparent from the record or of any mistake in the valuation of any property in any case other than a case in which the valuation of any property in any case other than a case in which the valuation has been the subject matter of an appeal under this act or of the omission of any property, the estate duty paid thereon is either in excess of or less than the actual duty payable, he may, either on his own motion or on the application of the person accountable and after obtaining the previous approval of the Board, at any time within three years from the date on which the estate duty was first determined.
(a) refund the excess duty paid, or as the case may be,
(b) determine the additional duty payab
(1) Any person.-
(a) objecting.-
(i) to any valuation made by the Controller or
(ii) to any order made by the Controller determining the estate duty payable, or
(iii) to any penalty levied by the Controller under section 56, or
(iv) to any final order or adjudication having the effect of imposing a liability or an obligation to pay estate duty in respect of any property, or
(b) denying his liability to account for the estate duty payable in respect of any property or
(c) objecting to any order made by the Controller refusing to grant a certificate of discharge or any other certificate under this Act,
&
(1) Within ninety days of the date upon which he is served an order under sub-section (3) of section 63, the person accountable may present an application to the Board in the prescribed from, accompanied by a fee of one hundred rupees, requiring the Board to refer to the High Court any question of law arising out of such order, and the Board shall, if in its opinion a question of law arises out o f such order, state the case for the opinion of the High Court:
Provided that the Board may admit such an application after the expiry of ninety days if it is satisfied that there was sufficient cause for not presenting it within the said period.
(2) If, on an application made under sub-section (1) the Board.-
(a) refuses to state a case on the ground that no question of law arises or
&
(1) When a case has been stated to the High Court under section 64, it shall be heard by a Bench of not less than two Judges of the High Court, and shall be decided in accordance with the opinion of such Judges or of the majority (if any) of such Judges.
Provided that where there is no such majority, the Judges shall state the point of law upon which they differ, and the case shall then be heard upon that point only by one or more of the other Judges of the High Court, and such point shall be decided according to the opinion of the majority of the Judges who have heard the case, including those who first heard it.
(2) An appeal shall lie to the Supreme Court from any judgement of the High Court delivered on a case stated under section 64 in any case which the High Court certifies to be a fit one for appeal to the Supreme Court.
Where any grant of representation has been applied for it shall not be delayed by reason of any reference to a High Court under section 64.
(1) Where the valuation is amended by the person accountable upon the Controller's requisition under sub-section (1) of section 61 or is enhanced by the Court upon the Board's reference under section 64, and in any case where the original valuation has been discovered to be too low, such person shall, within two months, of the amendment or enhancement or discovery pay the deficit duty which is payable in respect of the property upon the amended or enhanced or full valuation ad the Controller shall thereupon grant him a certificate accordingly.
(2) Where the valuation is reduced by the Court on the Board's reference under section 64, the Controller shall refund to the person accountable any excess duty paid by him within two months from the date of receipt by him of the order and shall grant OT him a certificate that the full duty payable in respect of the property has been paid.
The Controller in his discretion may upon application by a person entitled to an interest in expectancy commute the 4estate duty which would or might but for the commutation become payable in respect of such interest of r accretion sum to be presently paid and for determining that sum shall cause a present value to be set upon such duty regard being had to the contingencies affecting the liability to and rate and amount of such duty and interest being reckoned at three per cent, and on the receipt of such sum the controller shall give a certificate accordingly.
Where by reason of the number of deaths upon which property has passed or of the complicated nature of the interests of different persons in property which has passed on death or from any other cause, it is difficult to ascertain exactly the amount of estate duty payable in respect of any property or any interest therein or so to ascertain the same without undue expense in proportion to the value of the property or interest, the Board, on the application of any person accountable for the duty and upon his giving to the Board all the information in his power respecting the amount of the property and the several interests therein and other circumstances of the case, may by way of composition for all or any of the duties payable in respect of the property or interest and the various interests therein or any of them, assess such sum on the value of the property or interest, as having regard to the circumstances appears proper, and may accept payment of the sum so assesse
(1) Where the controller is satisfied that the estate duty leviable in respect of any property cannot, without excessive sacrifice be raised at once, he may allow payment to be postponed for such period, to such extent and non payment of such interest not exceeding four cent,.or any higher interest yielded by the property, and on such other terms as he may think fit.
(2) Notwithstanding anything contained in sub-section (1) estate duty in respect of immovable property may at the option of the person accountable be paid in eight equal yearly instalments or sixteen equal half-yearly instalments with interest at the rate of four per cent.per annum or any higher interest yielded by the property from the date on which the first instalment is payable and the interest on the unpaid portion of the duty shall be added to each instalment and paid accordingly; but the duty for the time being
If after the expiration of twenty years from a death upon which estate duty became leviable any such duty remains unpaid the Board may if it thinks fit, on the application of any person accountable or liable for such duty or interested in the property, remit the payment of such duty or any part thereof or any interest thereon.
All affidavits, accounts, certificates, statements and forms used for the purposes of this Part of this act shall be in such form and contain such particulars as may be prescribed by the Board and if so required by the Board shall be in duplicate and accounts ad statements shall be delivered and verified on oath and by production of books and documents in the manner prescribed by th Board and any person who wilfully fails to comply with provisions of this section shall be liable to the penalty mentioned in section 56.
Any estate duty or deficit duty and any interest or penalty payable under this Act may, on the certificate of the Controller, be recovered from the person liable thereto as if it were an arrear of land revenue by any Collector in any State.
(1) Subject to the provisions of section 19, the estate duty payable in respect of property, movable or immovable, passing on the death of the deceased, shall be a first charge on the immovable property so passing (including agricultural land) in whomsoever it may vest on his death after the debts and in cumbrances allowable under Part VI of this Act; and any private transfer or delivery of such property shall be void against any claim in respect of such estate duty.
(2) A rateable part of the estate duty on an estate, in proportion to the value of any beneficial interest in possession in movable property which passes to any person (other than the legal representative of the deceased) on the death of the deceased shall be a first charge on such interest:
Provided that the property shall not be so chargeable as against a bona fide purchas
A certificate granted by the Controller under section 67, or by the Board under section 69, shall discharge the property included therein ad the grantee so far as regards that property from any further claim for estate duty, but shall not discharge any person or property from estate duty in case of fraud or failure to disclose material facts and shall not affect the duty payable in respect of any property afterwards shown to have passed on the death nor any further duty payable by reason thereof in respect of the property included in the certificate:
Provided nevertheless that a certificate purporting to be a discharge of the whole estate duty payable in respect of any property included in the certificate shall exonerate a bona fide purchaser for valuable consideration without notice form the duty notwithstanding any such fraud or failure.
If a person accountable under section 53 pays any part of the estate duty in respect of any property not passing to him; it shall where occasion requires be repaid to him by the trustees or owners of the property.
(1) A person authorised or required to pay estate duty in respect of any property shall, for the purposes of paying the duty or raising the amount of the duty when already paid, have power, whether the property is or is not vested in him, to raise the amount of such duty and any interest and expenses properly paid or incurred by him in respect therefor by the sale or mortgage of or a terminable charge on that property or any party thereof:
Provided that any sum payable under any such sale, mortgage or terminable charge may be paid ( (to the extent to which such sum or part thereof represents the estate duty payable) not to the person raising the sum but to the Controller at the option of the person from whom the sum is being raised.
(2) A person having an interest in any property who pays the estate duty in respect of that property shall
No suit shall be brought in any Civil Court to set aside or modify any estate duty determined under this Act and no prosecution suit or other proceedings shall lie against any officer of Government for anything in good faith done or intended to be done under this Act.
Every authority specified in sub-section (1) of section 4, other than valuers, shall, for the purposes of this Act have the same powers as are vested in a Court under the code of Civil Procedure, 1908 (Act V of 1908) when trying a suit in respect of the following matters, namely :.-
(a) enforcing the attendance of any person and examining him on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavit ;
(d) issuing commissions for the examination of witnesses;
and any proceeding before any such authority under this Act shall be deemed to be a judicial proceeding within the meaning of section 193 and 228 of the Indian Penal Code (Act XLV of 1860) .
The provisions of section 54 of the Indian Income-tax Act, 1922 (XI of 1922) , shall apply to all accounts, statements, documents, evidence or affidavits, given, produced or obtained in connection with or in the course of the proceedings under this Act :
Provided that nothing in the said section 54 shall apply to the disclosures of any such particulars to any person acting in the execution of this Act or of the Indian Income-tax Act, 1922 (XI of 1922) , where it is necessary or desirable to disclose the same to him for the purposes of either this Act or the said Act.
The Central Government May make arrangements with the Government of any State for exchange of such information as may be necessary for the purposes of levying or realising any estate duty under this Act or under any other law for the time being in force in that State.
Any notice or requisition under this Act may be served on the person therein named either by post or as if it were a summons issued by a Court under the Code of Civil Procedure, 1908 (Act V of 1908) .
Any person accountable for estate duty who is entitled or required to attend before any authority specified in sub-section (1) of section 4 in connection with any proceeding under this Act, otherwise than when required under section 79 in attend in person, may attend by a person authorised by him in writing in this behalf, being a relative of or a person regularly employed by that person, or a legal practitioner or a chartered accountant.
Explanation.- In this section .-
(a) a person regularly employed by the accountable person shall include any officer of a Scheduled Bank with which the accountable person maintains a current account or has other regular dealings;
(b) 'legal practitioner' means an advocate, vakil or attorney of any High Court in the territories to which this Act extends and in
(1) Where a company incorporated outside India carries on business in the territories to which this Act extends and has been treated for the purposes of the Indian Income-tax Act, 1922 (XI of 1922) , as resident for two out of the three completed assessments immediately preceding, the death of a member dying after the commencement of this Act, furnish to the controller such particulars as may be prescribed in respect of the estate duty at the rates mentioned in Part III of the Second Schedule, on the principal value of the shares held by the deceased in the company except in cases where the deceased member was a person domiciled in India and the person accountable has obtained a certificate from the Controller showing that either the estate duty in respect thereof has been paid or will be paid or that none is due, as the case may be.
(2) If any member of a company formed and regist
(1) Subject to the condition of previous publication and subject to the control of the Central Government, the Board may make rules not inconsistent with this Act prescribing all matters which by this Act are required or permitted to be prescribed, or which are necessary or convenient to be prescribed for carrying out the purposes of or giving effect to this Act.
(2) the power to make rules conferred by this section shall, on the first occasion of the exercise thereof, include the power to give retrospective effect to the rules or any of them from a date not earlier than the date of the commencement of this Act.
(3) All rules made under this Act shall be laid before both Houses of Parliament as soon as may be after they are made.
THE FIRST SCHEDULE
(See section 5)
States in which estate duty is leviable on agricultural land
Bombay.
Madhya Pradesh.
Orissa.
Punjab.
Uttar Pradesh.
Hyderabad.
Madhya Bharat.
Rajasthan.
Saurashtra.
All Part C States.
THE SECOND SCHEDULE
(See Sections 5, 35 and 84)
RATES OF ESTATE DUTY
PART I
In the case of property which consists of an interest in the joint family property of a Hindu family governed by the Mitakshara, Marumakkattayam or Aliyasantana law:.-
Rate of Duty
(1) On the first Rs.50000 of the principal value of the estate Nil
(2) on the next Rs.50000 " " 5 per cent
(3) on the next Rs.50000 " " 7 1/2 per cent
(4) on the next Rs.50000 " " 10 per cent
(5) on the next Rs.100000 " " 12 1/2 per
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