TMI Blog1976 (9) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... lowance every year from the accountable person and that the same had been made a charge on a property. On further examination, he found that the deceased had effected a settlement in respect of the house property at No. 98, Mint Street, Madras, in favour of her grandson on May 23, 1945, and that in that settlement the deceased had reserved an interest in the said property. Consequently, according to the Assistant Controller of Estate Duty, provisions of section 12 of the Act were applicable. Accordingly, the assessment was completed on July 29, 1967, on a principal value of Rs. 1,51,593 including the value of the property settled under the document dated May 23, 1945. The Assistant Controller of Estate Duty was of the opinion that the accountable person had without reasonable cause failed to admit the value of the settled property (probably he meant the value of the property settled under the document dated May 23, 1945), in the estate duty return and had thereby concealed the particulars of the principal value of the estate, with the result he issued a notice under section 60(2) of the Act on July 29, 1967. In reply to this, the accountable person pleaded that the settlement took ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent views on a question. For instance, if the assessing authority takes one view and the appellate authority takes another view, from that itself it can be stated that there is scope for argument that a particular person who had not done a particular thing might have omitted to do it as a result of bona fide impression that he was not bound to do it. But in this particular case, the difference of opinion which the Tribunal points out is the difference of opinion between the accountable person and the assessing officer. On the face of it, that cannot be said to be a difference of opinion and such difference of opinion can have no bearing on the question of deciding the bona fides of the accountable person. As a matter of fact, there is bound to be difference of opinion in every case between an assessee and the assessing officer, unless the assessee submits to the assessment. In all other cases when the assessee contests the assessment in respect of any particular matter and the assessing officer does not accept the case of the assessee, it cannot be said that there is a difference of opinion on the issue in question. Therefore, we have, no hesitation whatever in pointing out that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e shall now have to consider section 60(1)(c) of the Act under which alone penalty has been levied. Section 60(1)(c) of the Act, so far as material, is : " If the Controller, the Appellate Controller or the Appellate Tribunal, in the course of any proceedings under this Act, is satisfied that any person--...... (c) has concealed the particulars of the property of the deceased or deliberately furnished inaccurate particulars thereof ; ...... he or it may, by order in writing, direct that-- such person shall pay by way of penalty....... (ii)...... in addition to the amount of the estate duty payable by him, a sum not exceeding twice the amount of the estate duty, if any, which would have been avoided if the principal value shown in the account of such person had been accepted as correct. " Consequently, the basis for the incurring of the liability to penalty is concealment of the particulars of the property of the deceased or the deliberate furnishing of inaccurate particulars of the property of the deceased. The property coming within the scope of section 12 of the Act cannot be said to be the property of the deceased, as we have pointed out already, and that is the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a partner ; (iii) from assets transferred directly or indirectly to the wife by the husband otherwise than for adequate consideration or in connection with an agreement to live apart ; or (iv) from assets transferred directly or indirectly to the minor child, not being a married daughter, by such individual otherwise than for adequate consideration. " The income referred to in section 16(3)(a)(i) of the Indian Income-tax Act, 1922, was certainly the income of the wife belonging to her as partner in the firm. So also under section 16(3)(a)(ii) the income was the income of the minor belonging to him or her as having been admitted to the benefits of the partnership. Similarly, under section 16(3)(a)(iii) the income referable to the transferred assets belonged to the wife. Under section 16(3)(a)(iv), the income referable to the transferred assets belonged to the minor child. Notwithstanding the fact that the income belonged to the wife or the minor child, as the case may be, the statute provided that the said income should be assessed in the hands of the assessee along with his income. But that provision will not in any way render the income of the wife or the minor child as th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a fiction that the property must be deemed to pass on the death of the settlor, in view of the reservation made by him, notwithstanding the fact that both in law and in fact the property had already passed to the settlee by virtue of the settlement deed. So long as the property covered by section 12 of the Act cannot be said to be the property of the deceased--on this there can be no doubt whatever because the section itself creates only a fiction--the provisions of section 60(1)(c) of the Act cannot be applied. Mr. Jayaraman, learned standing counsel for the department, contended that the form prescribed under the Act for the purpose of filing the account compels the accountable person to include the property covered by section 12 of the Act in the account and that so long as he has failed to include the same he will be liable to penalty under section 60(1)(c) of the Act. We are unable to accept this argument. We have already referred to the fact that the accountable person in this case filed his account in Form E.D. 1-A. Our attention was drawn to certain paragraphs in this form and in particular to paragraphs 18 and 19 which have been sworn to by the accountable person in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value of the property covered by section 12 of the Act. There are two answers to this contention. In the first place, even if those two sub-paragraphs compelled the accountable person to give particulars of the property coming within the scope of section 12, still his failure to do so will not attract section 60(1)(c) of the Act because the content of the form cannot control or qualify or enlarge the scope of the penal provision contained in section 60(1)(c) of the Act. As we have pointed out already, section 60(1)(c) of the Act is concerned only with the property of the deceased and it does not concern itself with the property deemed to pass on the death of the deceased. Therefore, even if paragraph 19 required the accountable person to include the value of the property falling within the scope of section 12 of the Act and the accountable person had failed to do so, that would not expose the accountable person to liability under section 60(1)(c) of the Act, in view of the language of that very section. We shall illustrate this position also on the basis of an analogy of section 34(1)(a) read with section 16(3) of the Indian Income-tax Act, 1922. Section 34(1)(a) of the Indian In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 34(1)(a). " As a matter of fact, the case under the Act (the Estate Duty Act) with which we are dealing will stand on a stronger footing. Section 34(1)(a) of the Indian Income-tax Act, 1922, used the expression " by reason of the omission or failure on the part of an assessee to make a return of his income under section 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year. " Even though the section uses the expression " his income " in relation to the omission or failure to make a return, with regard to the disclosure it uses only the expression, " necessary for his assessment for that year." In the present case, section 60(1)(c) of the Act expressly and categorically refers to the property of deceased, there being no scope whatever for any ambiguity. Consequently, even if there had been an obligation on the part of the accountable person, by virtue of the form of return, to include the value of the property coming within the scope of section 12 of the Act as a part of the assessable estate, still we are of the opinion that that will not attract section 60(1)(c) of the Act. We may also point out that from a readi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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