Law:

Section:

Section 59, read with section 62, of the Estate Duty Act, 1953 and rule 15 of the Estate Duty (Controlled Companies) Rules, 1953 - Reassessment - Deceased was chairman and managing director of a company holding 2150 ordinary shares and 9050 preference shares - In original assessment dated 22-3-1960, 2150 ordinary shares were valued at Rs. 1250 each - Subsequent to commencement of Estate Duty (Amendment) Act, 1958, with effect from 1-7-1960, which introduced section 59 for reassessment, Deputy Controller issued a notice under section 59 to petitioner seeking to reassess deceased on grounds (a) that either through error or inadvertence Deputy Controller completely overlooked mandatory provisions of rule 15 when he made original assessment and (b) that Assessing Officer had proceeded on basis that company was a dealer in shares whereas correct position was that company was an investment company and, therefore, a mistake by Assessing Officer in making original assessment was apparent on record - Whether there is nothing in provisions of section 59 to suggest that it has been given any retrospective operation - Held, yes - Whether though deceased was appointed as managing director of company with full power of board of directors for one year, he did not have control of company within meaning of rule 15, therefore, said rule could not apply in circumstances of case - Held, yes - Whether there was nothing to show that company was a dealer in shares hence, there was no "information" in possession of Deputy Controller such as required under provisions of section 59(b) to enable him to reopen order passed on 22-3-1960 - Held, yes - Whether therefore, impugned notice was to be quashed and respondent was to be prohibited from making any order of reassessment upon that notice - Held, yes FACTS The deceased was the chairman and managing director of a company. The subscribed and paid-up capital of the company consisted of 25,250 ordinary shares of Rs. 100 each and 75,750 preference shares of Rs. 100 each, out of which he deceased owned 2,150 ordinary shares and 9,050 preference shares. The deceased had, some time prior to his death, gifted away some part of his share capital…

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