A.D.V. Reddy, J.
1. Among the numerous and variety of private and publics trust created by late Nawab Mir Sir Osman AH Khan Bahadur, the ex-Nizam of Hyderabad, was one named ' The H. E. H. the Nizam's Family Pocket Money Trust' meant to provide for certain expenses of his wives, children, grand-children, etc. whereunder 55 lakhs of rupees in the shape of Government securities were settled as trust to be divided notionally into 50 equal units, out of which groups of units were allocated to different members of the family regarding which provisions were made in the trust deed, dated December 29, 1950. We are now concerned with 20 such units which were allotted for the benefit of one Amina Marzia, second daughter of the settlor's second son, Prince Muazzam Jah Bahadur. The relevant portion of Clause 8(a) of the trust deed, dealing with this part of the settlement, reads as follows :
' (a) to hold the 20 (twenty) equal units of the corpus of the trust fund allocated to Dulhan Pasha Begum, wife of the settlor upon trust to accumulate the income thereof during the lifetime of the said Dulhan Pasha Begum and if the trustees so think fit to apply, pay or spend from time to time out of the accumulations of such income such sums as they in their discretion may from time to time think fit for the purchase of a suitable house for Amina Marzia the second daughter of the settlor's second son Prince Muazzam Jah Bahadur or on the occasion of her marriage or for such other proper or necessary expenses of the said Amina Marzia as the trustees may think proper and on and after the death of the said Dulhan Pasha Begum to apply, pay or spend the income of the said 20 equal units of the corpus of the trust fund to the said Amina Marzia for and during the term of her natural life and on and after the death of the said Amina Marzia to divide, hand over and transfer the said 20 equal units of the corpus of the trust fund together with the accumulations of the income thereof (if any) and the investments thereof then in the hands of the trustees amongst and to the children and/or remoter issue then surviving of the said Amina Marzia in accordance with the provisions of the Mahomedan law of inheritance as if the said Amina had died intestate, etc.......'
2. The rest of the provisions relate to the devolution of the properties in case of certain contingencies with which we are not now concerned as, they are not relevant for our purpose.
3. On the 'death of Dulhan Pasha Begum, wife of the settlor, on February 15, 1955, the Deputy Controller of Estate Duty subjected the twenty (20) units of the entire trust money with the accumulated income thereon totalling up to Rs. 2,10,807, to estate duty/on the ground that the 'entire estate passed to the accountable persons, viz., the trustees. On appeal, the Appellate Controller of Estate Duty confirmed the same, and on further appeal to the Appellate Tribunal, it held that no property passed on the death of. Dulhan Pasha Begum and cancelled the assessment. Hence the reference for the determination of the question:
' Whether, on the facts and in the circumstances of the case, and on a proper interpretation of Clause 8(a) of the deed of H. E. H. the Nizam's Pocket Money Trust, the value of the corpus of 20 units allotted to the deceased and the accumulations of income therefrom passed on the death of the deceased ?'
4. It is evident from the trust deed that Dulhan Pasha Begum, the wife of the settlor, derived no interest either in the corpus, or the income of the trust property. The actual beneficiary under the trust deed is Amina Marzia, the daughter of the settlor's second son, Prince Muazzam Jha Bahadur. Her beneficial interest under the trust is regulated in relation to the life of Dulhan Pasha Begum. Therefore, it has to be seen how far the death of Dulhan Pasha Begum attracts the levy of estate duty.
5. Section 5 of the Estate Duty Act is the charging section, under which duty has to be levied on property, settled or not settled, which passes on the death of a person. The Estate Duty Act is modelled on the U. K. Finance Act, 1894, and Section 5 of the Estate Duty Act is almost in similar terms as Section 1 of that Act. The expression ' passes on the death ' has not been defined in either of the Acts. But it has been subjected to judicial interpretation ever since the passing of the Finance Act. The simplest meaning of the term is the ' passing of the property or the estate devolving on the death of a person '. But, the ' passing of property ' is not limited to devolution on the death of a person to whom the property belongs. It may also pass on the death of a party to whom the property does not belong as is indicated in Section 34(3) of the Estate Duty Act.
6. In Attorney-General v. Milne,  A.C. 765, 779 ; 2 E.D.C. 8 (H.L.) Lord Parker of Waddington stated that it denotes some actual change in the title or possession of the property as a whole which takes place at the death. Later, Viscount Haldane L. C. in Neville v. Inland Revenue Commissioners,  A.C. 385, 389 ; 2 E.D.C. 219 (H.L.). stated that the word 'passes' may be taken as meaning ' changes hands '. Subsequently, in Scott v. Inland Revenue Commissioners,  A.C. 174 ; 2 E.D.C. 579 (H.L.) Lord Russell of Killowen held that in order to constitute a passing of property on death within the meaning of Section 1 of the U. K. Finance Act, 1894, there must be a passing beneficially from some person or persons to another person or persons, though, in that case, the accountable person there was held finally responsible as the entire estate had passed to him, on the ground that, on the death, the trust that began was different from the one that ended. As observed by Lord Radcliffe in Public Trustee v. Inland Revenue Commissioners,  A.C. 398 ;  1 All E.R. 1, II ;  43 I.T.R. (E.D.) 19 (H.L.). the passing of property is equivalent to changing hands in enjoyment and in order to arrive at a correct decision on the question as to when the property passes, we must focus our attention on a comparison between the persons beneficially interested in the fund the moment before the death, and the persons so interested the moment after the death; and if after such comparison it appears that the beneficial possession or enjoyment of the property or a definable part thereof is in substance and effect unaffected by the death, the property or that part of it cannot be said to have passed on death even if, as a matter of terminology, one set of limitations has ceased to have effect and another has become operative or the beneficiary was entitled to capital thereafter ; that if the same person remains in beneficial possession or enjoyment of the property both before and after death without interruption, there is no passing of property even if there is change of source or title.
7. In Adamson v. Attorney-General,  A.C. 257 ; 2 H.D.C. 419 (H.L) where the property was settled by the deceased person upon trust to apply the capital and the income for his children then living and thereafter to be born as the settlor would appoint and subject thereto, the income was to be accumulated and on the settlor's death, the trust funds and accumulations were to be held for the settlor's children living at his death, as he should appoint, and in default 2/5 the should go to his elder son and 3/5ths to his other children living on his death and if no children surviving, there was to be a gift-over to the settlor's next of kin at his death and the settlor died without making any further provisions, leaving a son and three daughters, the question arose whether the trust funds and accumulations passed on the death of the deceased and it was held by the House of Lords by a majority, that they did not, on the ground that the son was given an immediate vested interest in the property and his interest was defeasible only if his father exercised special power of appointment or if he had died within the lifetime of his father, but as these did not happen, the property did not change hands or pass and on the death of the father, the vested interest became absolute and indefeasible. It was observed therein by Lord Russell of Killowen that 'mere turning of a contingent interest into a vested interest or a defeasible interest into an indefeasible interest, was not a passing of property.'
8. In In re Weir's Settlement Trusts,  3 W.L.R, 860 ;  76 I.T.R. 53 (C.A.) a trust was created by Viscount Weir on the occasion of the marriage of his widowed daughter, where the trust period was fixed as 'expiring 21 years after the death of the; survivor of the then living descendants of King George V or the earlier expiration of 80 years ' and the direction given was to pay or apply the income of the trust fund during the trust period to the husband, wife and children or the remoter issue of the said marriage for the time being living as the trustees in their absolue discretion think fit and further empowering the trustees to transfer the whole or part of capital to the wife or any issue of the marriage, or to resettle the funds or other trusts in favour of the husband or the wife or the issue of the marriage, etc., and where the husband died and there was no issue of the marriage, the Crown claimed estate duty on the trust funds on the husband's death on the ground that the interest extending to the whole income had now passed to the wife, Russell L.J., while distinguishing the cases of Scott,  A.C. 174 ; 2 E.D.C. 579 (H.L.) and Burrell,  A.C. 286; 2 E.D.C. 590 (H.L.) stated that while in those cases there is a passing of property on them and a new trust began, in the case dealt with by them the same trust had continued, that it was a discretionary trust, the purpose of which was and continued to be to provide for the support of such of the parties to the marriage and their issue as should be from time to time living.
9. The present case is a simple one, where the beneficiary under the trust is one Amina Marzia and her heirs, and the beneficial interest of the said Amina Marzia was linked with the life of Dulhan Pasha Begam, the wife of the settlor. What motives moved the maker of the trust in fixing the lifetime of Dulhan Pasha Begum for the variation of the interest in the beneficiary is not clear. Probably, the time factor was thought of for the purpose of allowing the beneficiary to become mature in mind, in order to handle the income that she was allowed to enjoy, as during the lifetime of Dulhan Pasha Begum the trustees were to administer the income for her benefit on certain contingencies happening, that is, the purchase of a house, or marriage or other purposes, whereas after happening of the death of Dulhan Pasha Begum she must have the entire income herself to be spent as she wished. Amina Marzia had at no time any interest in the corpus which was to continue to be in trust to be administered for the benefit of Amina Marzia's children or as per the other instructions given in the the trust deed. Her interest was only in the income. She had beneficial interest in the income even prior to the death of Dulhan Pasha Begum. Death of Dulhan Pasha Begum did not in any way determine her interest, except that till then the trustees in their discretion had to deal with the income for her benefit, whereas after the death, she could deal with the income herself. To a certain extent, there was an enlargement of her right to deal with the income, but right through even before the death of Dulhan Pasha Begum and even after, her beneficial interest in the income had continued. The beneficial interest had become vested in her the moment the trust came into existence and the beneficial interest was not affected by the death of Dulhan Pasha Begum. Therefore, there was no passing of property on the death of Dulhan Pasha Begum.
10. The Tribunal was, therefore, right in holding that the death had effected no change in the rights and interests which the beneficiary had and therefore no property has passed and no duty can be levied under Section 5 of the Estate Duty Act on the property.
11. The question referred to us is, therefore, answered in the negative and in favour of the assessee. The assessee will get the costs from the department. Advocate's fee Rs. 250.