TMI Blog1966 (11) TMI 93X X X X Extracts X X X X X X X X Extracts X X X X ..... It is surmised that sthanams were also created by the Rajas by giving certain properties to military chieftains and public officers and also by tarwads creating them and allocating certain properties for their maintenance. Most of the incidents of a sthanam are well settled. Usually the seniormost male member of the family and occasionally a female member attains a sthanam. Properties are attached to the sthanam for the maintenance of its dignity. The legal position of a sthanee is equated to that of a Hindu widow in that he represents the estate for the time being and he can alienate the properties for necessity or for the benefit of the estate. Unlike a Hindu widow, the successor to a sthanee is always a life-estate-holder. In that respect his position is more analogous to an impartible estate-holder. He ceases to have any present interest in the tarwad properties. Like a Hindu widow or an impartible estate-holder, he has an absolute interest in the income of the sthanam properties or acquisitions therefrom. His position is approximated to a member separated from the family and that the members of the tarwad succeed to his acquisitions unless accreted to the estate and he succee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws : (1) In the case of every person dying after the commencement of this Act, there shall, save as hereinafter expressly provided, be levied and paid upon the principal value ascertained as hereinafter provided of all property, settled or not settled, including agricultural land situate in the territories which immediately before the 1st November, 1956, were comprised in the States specified in the First Schedule to this Act and in the Union territories of Dadra and Nagar Haveli, Goa, Daman and Diu and Pondicherry which passes on the death of such person, a duty called ' estate duty ' at the rates fixed in accordance with section 35. (2) The Central Government may, by notification in the official Gazette, add the names of any other States to the First Schedule in respect whereof resolutions have been passed by the legislatures of those States adopting this Act under clause (1) of article 252 of the Constitution in respect of estate duty on agricultural lands situate in those States, and on the issue of any such notification the States so added shall be deemed to be States specified in the First Schedule within the mea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iament or the Legislature of a State relating to the duty, of all property passing upon death or deemed, under the provisions of the said laws, so to pass. Section 5 of the Estate Duty Act, 1953, corresponds to section 1 of the United Kingdom Finance Act of 1894, which imposed for the first time an estate duty in that country. The meaning of the words passes on the death has not been the subject of a definition either in the Act of the United Kingdom or of this country. As stated in Mahendra Rambhai Patel v. Controller of Estate Duty [1955] 55 ITR (ED) 1, 15 : ... it would be a fair presumption to make that when the legislature enacted our Act, the legislature used the expression ' passes on the death' in the sense in which it had been judicially interpreted in England. We might, therefore, usefully refer to English decisions on the interpretation of section 1 of the U.K. Finance Act, 1894, in order to comprehend the true import of passing of property referred to in section 5 of our Act. In Attorney-General v. Milne [1914] AC 715; 2 EDC 8, Lord Parker of Waddington-father of the present Lord Chief Justice of England-said that the expression passes on the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two places where they occur, the words ' or her ' shall be respectively inserted. (b) In the Explanation to sub-section (3) the word 'male' shall be omitted. (c) The existing explanation to sub-section (3), shall be numbered as Explanation I and the following shall be added as Explanation II. Explanation II.-The devolution of sthanam properties under sub-section (3) and their division among the members of the family and heirs shall not be deemed to have conferred upon them in respect of immovable properties any higher rights than the sthanamdar regarding eviction or otherwise as against tenants who were holding such properties under the sthani. The contention of the appellant in Writ Appeal No. 276 of 1965 and of the respondents in Writ Appeals Nos. 119, 174, 179 and 338 of 1965 is that as a result of the partition postulated immediately before the death of a sthanamdar in the provision above-mentioned, the property that passes or should be deemed to pass on the death of a sthanamdar is only his per capita share of the sthanam property and not the whole of the sthanam property. The notional partit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iately before the death of the sthanamdar among himself and all the members of his family then living. The device of the as if should be confined to the purpose for which it was intended. Leach M.R. said in Parr v. Parr [1883] 2 LJ Ch. 167, that the word devolve means to pass from a person dying to a person living and that the etymology of the word shows its meaning . We entertain no doubt that it is in the sense indicated by the Master of the Rolls that the word devolve is used in the first portion of sub-section (3) of section 7 when it says that the sthanam property held by a sthanamdar shall devolve upon the members of the family to which the sthanamdar belonged and the heirs of the sthanamdar. In other words, the words as if the sthanam property had been divided per capita immediately before the death of the sthanamdar do not attenuate the sthanam property that passes on the death of a sthanamdar to a per capita share therein as contended by the appellant in Writ Appeal No. 276 of 1965 and by the respondent in Writ Appeals Nos. 119, 174, 179 and 338 of 1965. Under the Scots law a dissolution of marriage at the instance of an innocent wife entitles her to a shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.What is the extent of the property that attracts estate duty on the death of a sthanamdar ? The whole of the property that passes or is deemed to pass on the death of a sthanamdar, namely, the whole of the sthanam property. In the light of what is stated above, Writ Appeals Nos. 119, 174, 179 and 338 of 1965 have to be allowed and Writ Appeal No. 276 of 1965 has to be dismissed. We do so, but in the circumstances of the case without any order as to costs. Velu Pillai J.-I agree, but would like to add a few words of my own on the interpretation of section 7(3) of the Hindu Succession Act, 1956. The sthanam properties concerned in these appeals were held by the respective sthanamdars, all of whom died after the Hindu Succession Act came into force on the 17th June, 1956. By the impugned assessments, the whole of the sthanam property concerned in each case was assessed to estate duty. Section 5 is the charging section in the Estate Duty Act, sub-section (1) of which provides : In the case of every person dying after the commencement of this Act, there shall, save as hereinafter expressly provided, be levied and paid upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f, on a true construction, section 7(3) may be held to lay down only a rule of succession to sthanam property on the death of the sthanamdar, that is, of distribution of sthanam property between his successors, it is not to be supposed that it also lays down a rule for the imposition of estate duty as to what the sthanamdar died possessed of and what passed on his death to his successors as a body. What the Estate Duty Act taxes is not the interest to which some person succeeds on a death, but the interest which ceases by reason of the death : see M.C.J. Kagzi on Estate Duty in India, 1962 Edition, page 3, quoting from Hanson's Death Duties. Section 7(3) does ordain that a per capita division of sthanam property between the persons specified shall be deemed to have taken place just before the sthanamdar died. For that reason, I was first inclined to think that what the sthanamdar died possessed of was only the share that might have fallen to him on such division, notional though it be, and that, therefore, what passed on his death was only such share. On further reflection, I have come to the conclusion that the proper construction of the section is that what the sthanamdar di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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