Law:

Section:

Section 5 of the Estate Duty Act, 1953 - Property passing on death - Deceased was owner of leasehold rights in certain property - After expiry of lease in 1958, deceased and after his death on 21-4-1960 his legal heirs entered into negotiation as regards lease extension - While negotiations regarding amount of premium and ground rent under proposed lease were in progress, deceased continued in occupation and Collector continued to accept ground rent from him, and after his death from his heirs - On 15-11-1965 Collector agreed to execute fresh lease in favour of all heirs of deceased after enquiry - Whether as deceased remained in possession after determination of lease and collector accepted rent from him, thereby assenting to his continuing in possession, deceased could be said to become tenant from month to month holding over under section 116 of Transfer of property Act 1882 - Held, yes - Whether deceased's interest as such tenant which was transferable and heritable had passed upon his death to his heirs - Held, yes - Whether, therefore, it was property which must be deemed to have passed on his death and, estate duty was rightly levied in respect of lease hold property as property passing on deceased's death - Held, yes FACTS One 'M' became the owner of the lease-hold rights in the land and of the bungalow standing thereon some years before the lease expired in 1958. The parties entered into negotiations as regards the final terms of the proposed lease extension. 'M', and after his death on 21-2-1960, his heirs, continued to be in possession of the property and the Collector, as lessor, continued to accept rent from them. On 15-11-62, The Collector informed the heirs according permission to pay premium amount in instalments and to execute a fresh lease in favour of all the heirs after the enquiry. The Asstt. Controller included the value of the lease-hold property in the valuation of the deceased's estate. On second appeal, the accountable person contended that after the expiry of the lease in 1958, there was no interest in the property left to deceased which he was competent to dispose of. However, the Tribunal upheld the order of the Assistant…

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