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Pranavi Ram Baruva (No. 1) Vs. Assistant Controller of Estate Duty and anr. - Court Judgment

LegalCrystal Citation
Subject;Direct Taxation
CourtGuwahati High Court
Decided On
Case NumberCivil Rule No. 119 of 1971
Judge
ActsEstate Duty Act, 1953 - Sections 61
AppellantPranavi Ram Baruva (No. 1)
RespondentAssistant Controller of Estate Duty and anr.
Appellant AdvocateP. Choudhuri and R.L. Rava, Advs.
Respondent AdvocateG.K. Talukdar, Standing Counsel and D.K. Talukdar, Jr. Standing Counsel
Excerpt:
- - 6. from the appellate order it is clearly found that the appellate controller did not include the value of the area not under crops. but this finding of the assistant controller was not set aside by the appellate controller in his appellate order though both the original order as well as the rectified order of the assistant controller wore before the appellate controller when he heard the appeal. --at any time within five years from the date of any order passed by him or it, the controller, the appellate controller or the appellate tribunal may, on his or its own motion, rectify any mistake apparent from the record and shall, within a like period, rectify any such mistake which has been brought to the notice of the controller, the appellate controller or the appellate tribunal, as..........of india is directed against the rectification order dated november 14, 1969, passed by the appellate controller of estate duty, eastern zone, calcutta, under section 61 of the estate duty act, 1953, hereinafter referred to as 'the act'. 2. the facts of the case are as follows. one parvati prasad baruva died intestate on june 7, 1964, leaving certain properties. the accountable person, that is the petitioner in this case, submitted account of the estate of the deceased showing a net value of rs. 5,02,075.73 subject to reduction for tax liability. the assistant controller of estate duty determined the value of the estate under the act at rs. 17,05,116 and, accordingly, assessment was made on july 28, 1966, under section 58(3) of the act and demand notice and challan were issued.....
Judgment:

Pathak, C.J.

1. This application under Article 226/227 of the Constitution of India is directed against the rectification order dated November 14, 1969, passed by the Appellate Controller of Estate Duty, Eastern Zone, Calcutta, under Section 61 of the Estate Duty Act, 1953, hereinafter referred to as 'the Act'.

2. The facts of the case are as follows. One Parvati Prasad Baruva died intestate on June 7, 1964, leaving certain properties. The accountable person, that is the petitioner in this case, submitted account of the estate of the deceased showing a net value of Rs. 5,02,075.73 subject to reduction for tax liability. The Assistant Controller of Estate Duty determined the value of the estate under the Act at Rs. 17,05,116 and, accordingly, assessment was made on July 28, 1966, under Section 58(3) of the Act and demand notice and challan were issued accordingly. Thereafter, the accountable person preferred an appeal before the Appellate Controller under Section 62 of the Act. The appeal was filed on October 25, 1966. While the appeal was pending the Assistant Controller of Estate Duty, who passed the original order on July 28, 1966, rectified the assessment under Section 61 of the Act and reduced the net principal value of the estate by Rs. 6,01,397 and determined the value of the estate at Rs. 11,03,719.

3. It appears that this rectification order made by the Assistant Controller of Estate Duty was also before the Appellate Controller when he disposed of the appeal preferred against the original assessment. By his order dated July 8, 1969, the Appellate Controller of Estate Duty reduced the value of the principal estate as assessed by the rectification order of the Assistant Controller of Estate Duty by Rs. 7,96,256 and directed the Assistant Controller to modify the assessment accordingly. Thereafter, by order dated November 14, 1969, the Appellate Controller in exercise of power under Section 61 of the Act reduced the relief of

Rs. 7,96,256, granted in his earlier order dated July 8, 1969, to a relief of Rs. 5,47,824. The present writ petition is against this order of rectification.

4. We have heard the learned counsel of both the parties. The dispute arises regarding the valuation of the area not under cultivation. In his original order of assessment the Assistant Controller found that the area not under tea crops was 382.64 hectares or 945 acres in round figure and he valued the same at the rate of Rs. 600 per acre which came to Rs. 5,67,000 and this amount was taken into consideration while assessing the value of the principal estate. In his rectification order under Section 61 of the Act, however, the Assistant Controller did not take into account this area of 945 acres not under tea crops with the following observation:

'(b) Area not under crops,......945 acres.

This was valued @ Rs. 600 per acre which came to Rs. 5,67,000. This is not to be taken into account.'

5. Thus, the entire sum of Rs. 5,67,000 was deducted from the total value along with other deductions. In his appellate order dated July 8, 1969, in setting out the facts and referring to the revised assessment made by the Assistant Controller, the Appellate Controller referred to the area not under crops and stated that it was assessed by the Assistant Controller at the rate of Rs. 600 per acre and this was found in the revised assessment order. But this appears to be, on the face of it, a wrong statement on the part of the Appellate Controller, inasmuch as the Assistant Controller in his order of rectification specifically excluded the area not under crops and the value thereof was not taken into consideration in determining the principal value of the estate. Though the area not under crops, which was stated to be assessed at the rate of Rs. 600 per acre, was wrongly stated by the Appellate Controller to be found in the revised assessment, still he did not consider this area not under crops while determining the principal value of the estate. In paragraph 13 of his order the learned Appellate Controller has considered the valuation of the area under crops and after discussing the materials on record he has reduced the rate as assessed by the Assistant Controller from Rs. 3,000 per acre to Rs. 2,225 per acre and on that calculation the value of the area under crops was assessed at Rs. 8,25,000 in round figure.

6. From the appellate order it is clearly found that the Appellate Controller did not include the value of the area not under crops. In his rectification order the Assistant Controller refused to take the area not under crops into account and he had specifically mentioned that in his rectification order. But this finding of the Assistant Controller was not set aside by the Appellate Controller in his appellate order though both the original order as well as the rectified order of the Assistant Controller

wore before the Appellate Controller when he heard the appeal. Then subsequently by his rectified order passed under Section 61 of the Act, the Appellate Controller took into account this area not under crops and he accepted the valuation of this area not under crops at the rate of Rs. 600 per acre and included that amount in the principal value of the estate and to that extent he reduced the relief given by him in his appellate order dated July 8, 1969.

7. The question that falls for determination is whether the impugned order of the Appellate Controller passed under Section 61 of the Act is within jurisdiction. Section 61 of the Act reads as follows :

'61. Rectification of mistakes.--At any time within five years from the date of any order passed by him or it, the Controller, the Appellate Controller or the Appellate Tribunal may, on his or its own motion, rectify any mistake apparent from the record and shall, within a like period, rectify any such mistake which has been brought to the notice of the Controller, the Appellate Controller or the Appellate Tribunal, as the case may be, by the person accountable :

Provided that no such rectification shall be made which has the effect of enhancing the estate duty payable unless the person accountable has been given a reasonable opportunity of being heard in the matter.'

8. It is submitted on behalf of the accountable person that before passing the impugned order under Section 61 of the Act, no notice was issued to the accountable person and he was also not given any reasonable opportunity of being heard in the matter. The rectified order certainly enhanced the estate duty payable. That being so, the impugned order is bad on the ground of violation of the proviso to Section 61 of the Act itself. That apart, the power under Section 61 of the Act may be exercised by the appropriate authority when there is any mistake in the assessment order apparent from the record. In the instant case, as discussed hereinabove, the area not under crops was taken into consideration in the original assessment order, but in his rectified order the Assistant Controller refused to take into account the area not under crops and he had specifically stated so in his rectified order. The Appellate Controller noticed this though he wrongly stated that this was in the rectified order. Whatever that may be, this aspect of the matter was considered by the Appellate Controller and he also did not take into account the area not under crops, and on that basis the principal value of the estate was determined and Ms liability to pay the duty was quantified. Thereafter, the impugned order of rectification was made. In our considered opinion, there was no such mistake apparent from the record giving jurisdiction to the Appellate Controller to pass the impugned order under Section 61 of the Act.

9.

In the circumstances, we hold that, in any view of the matter, the impugned order of rectification dated November 14, 1969, is liable to be quashed, which we hereby do. The demand notice based on the impugned order of rectification, which has been quashed by this order, is also quashed. The demand for estate duty on the accountable person should be in accordance with the appellate order dated July 8, 1969.

10. The petition is, accordingly, allowed and the Rule is made absolute. There will be no order us to costs.

D.M. Sen, J.

11. I agree.


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