Law:

Section:

Section 33(1)(n), read with sections 34(1)(c) and 39(3), of the Estate Duty Act, 1953 - Exemption - Residential house - Deceased was karta of a HUF, who owned a residential house, valued at Rs. 88,000 - Whether for aggregation of lineal descendants' share for rate purposes, value of entire house was to be allowed exemption under section 33(1)(n) - Held, yes. Interpretation of statutes - Legal fiction - Literal rule of construction Facts The deceased was the karta of a HUF, who owned a residential house, valued at Rs. 88,000. Though the assessee claimed that while aggregating the lineal descendants' share for rate purposes, the entire value of the house was to be allowed exemption under section 33(1)(n), the Assistant Controller restricted the exemption to the share of the deceased only. This view was upheld by the Appellate Controller and the Tribunal. On reference : Held 1. There are three statutory fictions introduced for the purpose of levying estate duty on the coparcenary interest of a deceased in a HUF governed by Mitakshara law. Firstly, under section 7(1), the interest ceasing on the death of a coparcener shall be deemed to pass on his death. Secondly, under section 39(1), a partition is deemed to have taken place immediately before the death of such coparcener, for the purpose of determining the principal value of his share in the joint family property. Thirdly, under section 39(3) the whole of the joint family property shall be deemed to have belonged to the deceased for the purpose of estimating the principal value of the joint family property to arrive at the share of the deceased on date of his death. While the share of the deceased in the joint family properties gets exemption from estate duty in respect of property of the kinds mentioned in section 33, the shares of the living persons, i.e. , the shares of lineal descendants of the deceased, though aggregated under section 34(1 )(a), (b ) and (c), for rate purposes, would not get the exemptions under section 33. If the fiction under section 39(3 ) is given its full effect by treating the whole of the joint family property as belonging to the deceased, all the provisions of the Act, so far as may…

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