TMI Blog1966 (10) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... ure interest; and that he was presently entitled to the whole income of his one-half share in the said 160 shares and after provision of maintenance and advancement, if any surplus remained, it was to be accumulated and he was the beneficial owner of the accumulation of such surplus income and but for clause 5 he could dispose it of as he willed, and if he died it was heritable by his heirs. Appeal dismissed. - - - - - Dated:- 28-10-1966 - Judge(s) : V. RAMASWAMY., J. C. SHAH., V. BHARGAVA JUDGMENT The judgment of the court was delivered by SHAH J.-- Under a deed of trust dated June 26, 1941, one Rambhai Patel settled, subject to certain terms and conditions, 80 shares of the Central Cotton Trading Company (Uganda) Ltd. for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on beneficially interested before and after death, the value of shares was liable to be added to the estate of Manubhai on his death. The Board rejected the argument that the interest enjoyed by the deceased was not an interest in property, but only an ancillary right, and further held that Manubhai was entitled to the half share of the income from the date of the deed of trust, and the deed provided for the disposition of the corpus only in the event of premature death, while the deceased's heirs would be entitled to the savings from the income up to the date of death. The correctness of the view was challenged before the High Court, but without success. Determination of the question in dispute depends upon the provisions of the deed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pletes the age of twenty-five years. 6. In the event the said beneficiaries or any of them shall die before completing the age of twenty-five years leaving male issue or issues, the trustees shall stand possessed of the said shares in trust for such male issue or issues (if more than one in equal shares) till each of them completes the age of twenty-one years. 7. In the event the said beneficiaries or any of them shall die before completing the age of twenty-five years without leaving any male issue, the trustees shall stand possessed of the said shares in trust for the other then living sons of the said Rambhai Somabhai Patel in equal shares after making the following provision ...... [Clauses (a) and (b) make provision for the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the heirs of the beneficiary according to the personal law of succession and inheritance. This clearly indicates that the entire income accruing to each beneficiary in respect of his 80 shares belonged to him. Clause 5 also indicated that but for that clause the beneficiaries would have been entitled to exercise the right to mortgage or create any incumbrance or sell the shares and the accumulations thereof. By clause 4 it was expressly provided that on the attainment of the age of twenty-five years by each beneficiary the trustees shall transfer 80 shares and the accumulations thereof or any other investment in lieu thereof as provided in clauses 2 and 3 of the deed. On the clauses set out earlier, we are unable to accept the contenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ately on the death or after any interval, either certainly or contingently, and either originally or by way of substitutive limitation , and on the death includes at a period ascertainable only by reference to the death . The interest of Manubhai in the shares and in the accumulated income was property within the meaning of section 2(15). That property did, as we have already pointed out, vest in ownership in Manubhai immediately on the execution of the deed of trust. On Manubhai dying unmarried, the property as to the shares under clause 7 of the deed and as to the accumulated income under the law of inheritance devolved upon his brother, Mahendra. On Manubhai's death there was under the deed of trust a change in the person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under-age, and the defendants became indefeasibly entitled as tenants-in-common in fee of all the lands in the settlement, including H's share. It was held that estate duty was not payable as on a property passing on H's death, that H's interest had not became a beneficial interest in possession in the lands at his death, and that accordingly section 5 sub-section (3), of the Finance Act, 1894, was inapplicable. Section 5(3) of the Finance Act, 1894, which was later amplified by section 48 of the Finance Act, 1938, was substantially in the same terms as section 23 of the Estate Duty Act. But Power's case was decided on the footing that the settlor's interest was not vested in H in possession during his minority. The cou ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
