TMI Blog1966 (10) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... deceased and his wife, she was merely a name-lender and the entire property belonged to. the deceased and was rightly included in his estate for the purpose of estate duty. In view of this finding of fact it is not possible to accept the argument of the appellant that only half the share of the property should be taken for the purpose of estate duty assessment. Appeal dismissed. - - - - - Dated:- 28-10-1966 - Judge(s) : V. RAMASWAMY., J. C. SHAH., V. BHARGAVA JUDGMENT The judgment of the court was delivered by RAMASWAMI J.---This appeal is brought, by special leave, from the judgment of the Mysore High Court dated November 17, 1964, in Tax Referred Case No. 1 of 1964. The property in question is house No. 34, Mahatma Gandhi Road, Bangalore. It had been purchased by the appellant's father, Dr. C. F. Da Costa (hereinafter called the "deceased"), in the joint names of himself and his wife on February 14, 1940. They made a gift of the house to their two sons on October 29, 1954. The document recites that the donees had accepted the gift and they had been put in possession. But the parents continued to be in possession of the house, though the municipal tax was paid there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the donee and thenceforward retained to the entire exclusion of the donor or of any benefit to him by contract or otherwise : Provided that the property shall not be deemed to pass by reason only that it was not, as from the date of the gift, exclusively retained as aforesaid, if, by means of the surrender of the reserved benefit or otherwise, it is subsequently enjoyed to the entire exclusion of the donor or of any benefit to him for at least two years before the death." In the present case, the Board has found that, though the deceased had gifted the house in question to his children four years before the date of his death, he still continued to stay in the house till his death as the head of the family and also was looking after the affairs of the house. It was contended on behalf of the appellant that, upon these facts, the High Court erred in holding that section 10 of the Act was attracted to the case and there was no exclusion of the donor from the bona fide possession and enjoyment of the gifted property. It was said that the appellant's father did not have any right of possession or enjoyment of the gifted property either in law or in equity and, as the deceased ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he expression " by contract or otherwise " should be construed ejusdem generis and reference was made to the decision of Hamilton J. in Attorney-General v. Seccombe. On this aspect of the case, we think that the argument of the appellant is justified. In the context of the section, the word " otherwise " should, in our opinion, be construed ejusdem generis and it must be interpreted to mean some kind of legal obligation or some transaction enforceable at law or in equity which, though not in the form of a contract, may confer a benefit on the donor. But it was contended by Mr. Sen for the respondent that the case of the revenue does not rest upon the second limb of the section but upon the first limb which requires that the donor must have been entirely excluded from possession and enjoyment of the property. It was pointed out that there was no such exclusion in the present case and the finding of the Board is that the deceased continued to stay in the house till his death as the head of the family and was looking after the affairs of the household. It was contended, therefore, that the first limb of the section is not satisfied in this case and the property must be held to pass on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Stamp Duties of New South Wales, which is a decision on a similarly worded clause of a New South Wales statute. In that case, the deceased gave his son a farming property, "Mia Mia", in 1934; in 1935 the deceased, the son and another son entered into a partnership agreement as graziers and stock dealers, on the terms, inter alia, that the deceased should be the manager and that his decision should be final in all matters relating to the conduct of the business that the capital should consist of the livestock and plant owned by the partners; that the business should be conducted on their respective holdings (including "Mia Mia"); and that, the land held by each partner should be his sole property and he should have the sole and free right to deal with it as he might think fit. The partnership continued till the death of the deceased in 1952, and the property " Mia Mia " was held dutiable as a gift not to his entire exclusion. There is a decision to a similar effect in Commissioner of Stamp Duties of New South Wales v. Owens, which was a case under the New South Wales statute. It appears that there was a verbal partnership between the deceased and his son under which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section as it stood previous to the amendment and since no right of residence was reserved or secured to the donor under the deed of gift or under any collateral disposition, the imposition of estate duty was not justified. We are unable to accept this argument as correct. The amendment brought about by the Finance Act, 1965, was effective only from April 1, 1965, and was not retrospective. We think that the insertion of the second proviso to the section must be taken to have been made deliberately by Parliament to be effective from the date of the amendment. We, therefore, see no reason for holding that the earlier provision in section 10 should be interpreted with reference to the language of the amendment brought about by the Finance Act of 1965. We accordingly reject the argument of Mr. Srinivasan on this point. It was lastly contended for the appellant that, in any event, the property in question belonged jointly to the mother and father of the appellant and the whole property could not be deemed to have passed upon the death of the father under section 5 of the Act. The question was examined by the Board which found that the property was purchased entirely out of the fund ..... X X X X Extracts X X X X X X X X Extracts X X X X
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