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Section 5 of the Estate Duty Act, 1953-Property passing on death-Goodwill-Deceased partner in firms doing business in selling petrolium products under an agency agreement entered into with, burmah shell and also foreign liquor under a licence obtained from state government-Whether tribunal correct in holding that firms did not have any goodwill-Held, on facts, yes Facts The deceased was partner in three firms, which, inter se, carried on the business of selling petrol, diesel oil and kerosene oil under an agency agreement entered into with Burmah Shell and also foreign liquor under a licence obtained from the State Government. The Assistant Controller included in the dutiable estate the deceased's share of the goodwill in the two firms, aggregating Rs. 29,385. On appeal, the Appellate Controller confirmed the inclusion of goodwill but reduced the quantum. On second appeal, the Tribunal observed (i) that the right to carry on the business by the firms was a very temporary right depending upon the agency agreements and the licence; (ii ) that these licences and the agency agreements were not capable of being sold or transferred; and (iii ) that the excise rules specifically prohibited transfer of the licence. It, accordingly, held that the firms did not have any goodwill which could be said to pass on the death of the deceased. On reference: Held 1. The goodwill is the benefit and advantage of the good name, reputation and connection of business. Where the business is being done under a licence or under an agency agreement which is not transferable and which is for a short period and which can be cancelled at the sweet will of the grantor, there is no such benefit or advantage which a person carrying on that business derived because of the good name, reputation or connection in the business. 2. The Tribunal was, therefore, correct in holding that the two firms did not have any goodwill. Judgment H. N. Seth, J.-At the instance of the Controller of Estate Duty, the Income-tax Appellate Tribunal, Allahabad, has in connection with the estate duty assessment of the estate of Sri Bhagwan Das, stated the case and has referred the following question for the opinion of…

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