TMI Blog1989 (11) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... 1A of the Fatal Accident Act, 1855 the deceased was having a right to maintain an action for compensation for the injuries sustained by him and since such right was not forgone by him in his lifetime, that was inherited by his dependants/legal representatives who received the compensation in question, from the Claims Tribunal. The ACED thus held the view that the right of the deceased to bring an action for compensation for the injuries sustained by him was property within the meaning of the term defined in sec. 2(15) of the Estate Duty Act, 1953 ('the Act') which existed at the time of his death and passed on his death to his legal representatives and was accordingly dutiable u/s. 5 of the Act. In appeal the Appellate Controller of Estate Duty approved of this line of the reasoning and dismissed AP's appeal. 3. The learned counsel for the appellant has vehemently urged that what has undisputedly been received in the instant case was compensation for the death of the deceased and since this nature of property could have never been the property of the deceased so as to pass on his death it was not dutiable. Supreme Court decision in the case of M.Ct. Muthiah v. CED [1986] 161 ITR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1855 and sec. 110A of the M.V. Act, 1939. The relevant parts of these sections run as under : "Sec. 1A Fatal Accidents Act, 1855. Suit for compensation to the family of a person for loss occasioned to it by his death by actionable wrong -- Whenever the death of a person shall be caused by wrongful Act, neglect or default, and the act, neglect or default is such as would (if death had not ensued) have entitled the party injured to maintain an action and recover damages in respect thereof the party who would have been liable if death had not ensued shall be liable to an action or suit for damages, notwithstanding the death of the person injured, and although the death shall have been caused under such circumstances as amount in law to felony or other crime. Every such action or suit shall be for the benefit of the wife, husband, parent and child, if any, of the person whose death shall have been so caused, and shall be brought by and in the name of the executor, administrator or representative of the person deceased." It may be appreciated that sec. 1A would come into play in the cases of death of a person caused by wrongful act, neglect or default of other. 8. Sec. 110A o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a simple case of a person dying in a road accident and his legal representatives receiving compensation for his death from a claims Tribunal. In the very mode of death the property in the form of compensation for his death comes into existence after his death and therefore cannot be deemed to have passed on his death. It should be kept in mind that the compensation paid/payable u/s. 110A(1)(b) of M.V. Act is not by way of the price for the flesh and bones of the deceased, the belongings of the deceased at the time of his death but it is paid/payable to the representative of the deceased to compensate their loss caused by the death of the deceased. This right by its unique nature belongs to the legal representatives of the deceased from the very beginning. It can never belong to the deceased. Our views, we think, are fully fortified by the exposition of law made by the Supreme Court in the case of M.Ct. Muthiah. 12. In M.Ct. Muthiah's case the deceased, while proceeding to Malaya by air, had taken a personal accident policy for Rs. 2 lakhs with an insurance company and had effected a nomination in respect thereto in favour of his son, M.C. Muthia. The deceased died following the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers of the family of the deceased and had nothing to do with the estate of the deceased. 14. Similar view had been expressed by the Punjab Haryana High Court in the case of CED v. Motia Rani Malhotra [1975] 98 ITR 42 where it was held that there was a lot of difference between compensation received on account of permanent or temporary injury in an air crash and the compensation received by the heirs of a person dying in an air crash. In the former case the amount received by the person formed part of his estate but where the compensation was received by his heirs on his death that cannot partake of the character of his estate. This view too was affirmed by the Supreme Court in Muthiah's case. The contrary view of the Gujarat High Court as expressed in the case of Bharat Kumar Manilal Dalal v. CED [1975] 99 ITR 179 did not get the approval of the Supreme Court and was overruled. 15. Principles laid down in the cases mentioned above apply on all fours to the facts obtaining in the instant case. We therefore hold that since the property in the compensation for the death of the deceased was never possessed or enjoyed (constructively or actually) by the deceased in his lifetime an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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