Law:

Section:

section 70 of the Estate Duty Act, 1953 - Postponement of payment of duty - Whether unless an order is made under section 70, interest would not start running on estate duty as assessed - Held, yes Facts On the deceased's death, the Assistant Controller assessed the value of his estate and computed the estate duty payable thereon at Rs. 76,341.20 with the direction that the court fees paid for taking out the probate of the will would be allowed under section 62. The accountable persons on and from 31-3-1959 paid diverse amounts from time to time towards the estate duty. The Assistant Controller informed on or about 10-9-1957 that interest was chargeable on outstanding estate duty at 4 per cent with effect from 22-3-1959. Probate of the will of the deceased was granted to the accountable persons and on or about 16-8-1966 probate duty determined at Rs. 25,893.25 was paid by him. By his letter dated 30-8-1966 he claimed from the Assistant Controller a refund of Rs. 16,052.05 as excess paid towards estate duty. The authorities, however, declined to give the said relief. On writ under article 226, the High Court, however, directed the estate duty authorities to refund the amount claimed by the accountable person without prejudice to the claim of interest payable on the outstanding duty. Thereafter, the Assistant Controller initiated proceedings for recovery of the demand outstanding against interest in respect of the estate duty which was still payable, and the certificate officer issued notice on the accountable person to show cause why his properties should not be attached. The High Court issued rule nisi on application under article 226 which was later made absolute and the impugned demand and the proceedings were quashed. The judge found that only after an order was made directing the estate duty authorities to refund the excess amount to the accountable persons, the interest alleged to be payable by them was quantified. Following Prem Nath Khandelwal v.CED [1970] 77 ITR 949 (Cal.), it was held that the Estate Duty Act, 1953 did not provide for automatic running of interest, and unless an order was made under section 70 the interest would not run on the assessed…

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