Law:

Section:

Section 10 of Estate Duty Act, 1953 - Estate duty - Deemed gift - [Position prior to 1965] 'B" grandfather of accountable person made a gift of certain immovable properties to 'P', father of accountable person subject to conditions that said properties should remain in possession of 'B' as trustees of 'P' and 'B' would enjoy usufruct of such property in capacity - Complete possession and right in those properties would vest in 'P' only after death of 'B', 'P' predeceased 'B' - Subsequently 'P' also died - Whether under said deed there was no intention of giving anything to donee in praesenti and everything was reserved for future, both possession and enjoyment - Held, yes - Whether since during donor's life time donee had to entirely depend upon discretion of donor and donor was not excluded either from possession or enjoyment of property, revenue authorities were right in including value of gifted properties in value of estate, and if properties covered by deed of gift did not fall outside mischief of section 10, they should be treated as property passing also under section 5 - Held, yes FACTS 'B', the grandfather of the accountable person made gift of certain immovable properties to 'P' the father of the accountable person subject to the conditions that so long as 'B' was alive, the said properties should be in his possession as the 'P' trustee and he should enjoy the usufruct of such property as trustee of 'P' and that he would help 'P' according to his discretion and that after his demise complete possession and right of these properties would vest in 'P' predeceased 'B'. Subsequently on death of 'B' the Assistant Controller included the value of the said properties in the principal value of the deceased's estate. The Central Board of Revenue dismissed the appeal holding that the gifted properties the gifted properties were correctly included in the estate of the deceased as property deemed to have passed on the death, under section 10 and also that apart from the question of liability under section 10, the properties clearly passed on the death of the deceased under section 5, since a change in the beneficial interest therein took place on the death. On…

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