TMI Blog1990 (6) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... , after the deceased's death, by the accountable person ?" The deceased, late Gen. S. S. J. B. Rana, died on June 4, 1976. The proceedings relate to the estate duty assessment in respect of his estate. The controversy is about the sum of Rs. 13,69,092 which was received by his legal representatives as refund of the income-tax and wealth-tax for different assessment years pertaining naturally to periods prior to his death. While, according to the Estate Duty Authorities and the Tribunal, the aforesaid amount of Rs. 13,69,092 represented the property of the deceased passing on death and was thus chargeable to estate duty, it was the contention of the accountable persons that the refund had become due after the death of the deceased and thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned in this reference with the provisions under sub-sections (2) and (3) of that section. Section 212 (3A) requires an assessee to file his own estimate of advance tax payable by him if the tax on his income on the basis of which tax was demanded by the Income-tax Officer was likely to exceed by one-third of such tax. If advance tax is not paid as required under these provisions, the assessee is treated as an assessee in default and as held by this court in the case of Prakash Cotton Mills P. Ltd. v. CIT [1979] 120 ITR 497, even penalty can be imposed for non-payment of advance tax. In the circumstances, it has to be held that the tax paid in advance is neither a payment on account nor a deposit. It is discharge of a legal obligation under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rance money in the case of an accident policy became property on the happening of a specified contingency. That property arose on the death of the deceased during the subsistence of the policy. The property came into being on that contingency after death. Therefore, no property can be deemed to pass on the death of the deceased as no property existed at the time of the death. Under the circumstances, it will be reasonable to assume that, in order to fall within the expression "property" and "property passing on death", the property in some shape or the other must exist at the time of the death. In the present case, the deceased could not have claimed any refund until the assessment was completed and the refund became due as a result of that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vacuum Oil Co. Ltd. [1966] 59 ITR 569 and Assam Oil Co, Ltd. v. CWT [1966] 60 ITR 267, it was held that the assessee had no claim or title to the refund prior to the date on which the assessment was completed and, therefore, the amount of refund was not an asset in the hands of the assessee on the valuation date. It is true that the Madras High Court in the case of T. V. Srinivasan v. CWT [1985] 152 ITR 599 took a contrary view. However, in a subsequent decision reported in R. N. Goenka v. CIT [1989] 176 ITR 129, the court doubted its decision in T. V. Srinivasan v. CWT [1985] 152 ITR 599 and, directed the Tribunal to refer the question of law to it under section 27 of the Wealth-tax Act. In a different context, the Kerala High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. He laid great emphasis on the fact that though income-tax dues on the valuation date or on the date of death, for the period immediately prior to death or valuation date, must of necessity be computed after the death or valuation date, as the case may be, yet such dues are admittedly treated as the liability of the assessee/deceased on such dates. There is no good reason why a different standard should be applied while considering the question of refund. In support of his contentions Shri Jetley placed reliance on a Full Bench decision of the Delhi High Court in the case of Dewan Labh Chand v. CED [1972] 83 ITR 538, the Mysore High Court decision in the case of M. Lakshmamma V. CED [1964] 53 ITR (ED) 20 and the Supreme Court decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, no property can be deemed to pass on the death of the deceased." In the circumstances, unless it is possible to say that there was some amount due by way of refund as of right at the time of the death, it will not be "property" under the Estate Duty Act. Until the completion of the assessment, the deceased or his heirs had no right to claim refund as whether or not there would be any refund due would depend upon the completion of the assessment. The assessment could have resulted in further demand rather than any refund. The fact that the refund due was found to be Rs. 13,39,859 as against Rs. 22,00,000 odd on the basis of the returned income supports our view that until the completion of the assessment, nothing was certain. In the ci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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