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1998 (8) TMI 86 - SC - Indian LawsWhether the trust created by the deceased on 21st March, 1953 known as Sahebzadi Oalia Kulsum Trust is ab initio void? Whether on the interpretation of the trust deed, the value of the corpus of the Sahebzadi Oalia Kulsum Trust is liable to be included in the principal value of the estate of late Sir Osman Ali Khan Bahadur? Held that:- In the light of the principles of Mohammedan law as set out earlier, the two trusts created in 1953 in the present case are valid wakfs. The wakif-settlor made a dedication in perpetuity of the subject-matter of these trusts for purposes which are considered pious under Islamic law. The properties, therefore, ceased to be the properties of the settlor on the creation of the wakfs in 1953. When the settlor died in 1967, they could not form a part of his estate-the settlor having divested himself of these properties fourteen years prior to his death. therefore, the beneficial interest created in favour of Oalia Kulsum and Anwar Begum is a valid creation of trust which is not affected by ss. 13 and 14 of the Transfer of Property Act. As a result the settlor had divested himself of these properties during his lifetime for the benefit of his granddaughter Oalia Kulsum and his daughter -in-law Anwar Begum and thereafter for their descendants and then for the holy shrine at Khum. On the date of his death the Settlor did not have any interest in the properties nor had he reserved any interest to himself under these trusts. Hence, for the purposes of Estate Duty, the deceased cannot be considered as having any interest in the trust property which passed on his death. The properties which constituted the subject-matter of the two trusts, therefore, cannot be included in the estate of the deceased, Sir Mir Osman Ali Khan, the Nizam of Hyderabad, for the purposes of estate duty. In favour of appellant.
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