Law:

Section:

Section 35, read with section 34 of the Estate Duty Act, 1953 - Estate Duty - Rates of - Whether in order to grant rebate under section 35(3), authority has to take into consideration only principal value of property which passes on death of deceased and not property owned by lineal decendants - Held, yes - Whether, it is thereafter for purpose of determining rate of estate duty, value of lineal descendants' property will have to be added to property which passes on death of deceased - Held, yes FACTS The Assistant Controller, while computing the principal value of the estate of the deceased took the value of the free estate at Rs. ,08,530 and the value of the share of the lineal descendants under section 34(1)(c) at Rs. 1,31,753, thereby making the total principal value at Rs. 2,41,283. The estate of the deceased comprised agricultural lands as well. The Assistant Controller did not allow any rebate under section 35(3) on the ground that the principal value of the estate exceeded Rs. 2 lakhs. On appeal, however, the Appellate Controller reversed the same, holding that the aggregate value of the share of the lineal descendants should not be taken into reckoning while determining the value of the property for the purpose of rebate and, therefore, the accountable person was entitled to the relief under section 35. The Tribunal confirmed the same resulting in the dismissal of the appeal. On reference : HELD It is quite patent from the language of section 35(3), in particular with reference to the non-obstante clause occurring in the said sub-section, that what has to be taken into consideration for allowing by way of rebate as postulated under the said sub-section is "property passing on the death of any person", and "which consists wholly or in part of agricultural land and the principal value of the estate does not exceed rupees two lakhs". Therefore, it was quite manifest that there was absolutely no scope whatsoever for adding to the said property of the deceased the value of the property owned by the lineal descendants of the deceased. It would be reading something more into the said sub-section itself. That apart, it is equally manifest from the language of…

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