Law: Estate Duty Act, 1950

Section: 38, 42

  Estate Duty Act (X of 1950)  Ss. 38 & 42-Proper mode of determining principal value of property of deceased-Section 42 specifically authorises Controller to appoint a valuer for purposes of ascertaining or determining value of property Material and relevant factors in ascertaining market price of both plots and built up lands. No doubt, section 42 of the Estate Duty Act, 1950 confers power upon the Controller to ascertain the value of any property for the purposes of assessment of Estate Duty in such manner and by such means as he deems fit, but this power of the Controller is controlled by section 38, which enjoins him to fix the principal value of the property according to the market price at the time of the deceased's death. Section 38 of the Estate Duty Act, 1950 lays down the mode of deter mining the principal value of the property of the deceased. The said section is based on section 7(5) of the U. K. Finance Act, 1894 and section 60 (2) of the U. K. Finance Act, 1910. Subsection (1) of section 38 lays down that the principal value of the property is to be the price which in the opinion of the Controller, it would fetch in the open market at the time of deceased's death. Subsection (2) re-arms the principle of market value and requires the Controller, in estimating the principal value of any property, to fix the price according to its market value at the time of the death of the deceased. The subsection expressly bars the Controller from making any reduction in the estimate on account of the estimate being made on the assumption that the whole of the property is to be placed on the market at one and the same time and disposed of in one lot. Section 42 of the Act specifically authorizes the Controller to appoint a valuer for the purposes of ascertaining or determining the value of property. The valuer appointed in the case had taken into consideration a number of factors, including in the case of each building its location, age, type and nature, its normal life-expectancy, its state of maintenance, etc. While determining the value of land on which there were structures, in certain cases, the structures may result in the value of the…