Delhi High Court
L. Munshi Lal Bhasin vs The Controller Of Estate Duty Delhi And ... on 27 May, 1969
Equivalent citations: 6(1970)DLT129, [1970]77ITR247(DELHI)
Author: H.R. Khanna
Bench: H.R. Khanna
JUDGMENT S.K. Kapur, J.
(1) Munsbilal Bhasin died on 22nd January, 1957. The Assistant Controller of Estate Duty, New Delhi, determined the principal value of the estate passing on the death of the deceased at Rs.4,65,430. One of the items comprised in the estate was a sum of Rs. 36,030 representing a deposit of Rs. 30,000 made by the deceased on 8th November, 1954 in the name of his minor daughter Niloo with M/s. Motor General Finance Co. Ltd., and the interest thereon till the date of Munshi Lal's death.
(2) The case of the assessed was that the deceased had gifted the sum of Rs. 30,000 to his minor daughter on the date of deposit and therefore, no estate duty was payable on this amount the gift having been made more than two years before the date of death. The deceased made a will on 24th February, 1955 and it is necessary to read clause 7 and the material part of clause 8 of the will which are:- "I have also deposited Rs. 30,000 as a Fixed Deposit in Motor General & Finance Co. Ltd., in the name and for the benefit of my minor daughter Niloo under my own guardianship. She is absolutely entitled to it, it is my gift lo her outright. In case of death her guardian will be her mother Parkash Devi.
My entire property is self-acquired. After taking away the above mentioned property which I have already given away in gifts during my life time, by my own free-will the remaining property of mine at present in my hand comprises of shares of various companies,: .standings in my own name or lying unregistered.in my account with banks and Deposits with Banks or Companies or other Government Bonds and Securities of an approximate value of about Rs.3,50.000. I am owner of the property so long as I The Assistant Controller decided that "since the .presumption of advancement is rito applicable to Hindus, the deposit in question was apparently a benami transaction made by the deceased. The will takes effect after the death. There is no ocert act done by the deceased to Show that he had made a gift to his minor daughter on the date he made the deposit". The assfessee appealed before the Central Board of Revenue and the 'Board confirmed the inclusion of the said amount in the principal value of the estate; The Board after reading clause 7of the will held- "FROMthis it cannto be said, that -the deceased had intended to make a gift on the date of deposit. At the. most the narration in the will can. mean that the deceased by this will intended to treat the money depositcd;in the name of his daughter as money gifted to her. This can mean a gift from the date of signing of the will which is within 2 years of the date of death and so will be covered by Section 9 of the Act".
At the instance of the assessed, the following question of law was referred to the High Court:- "WHETHER,on the facts and in the circumstances of the case . the sum of Rs. 36,030 deposited with M/s. Motor General Finance Co.Ltd., in the name of the minor daug . the deceased, were correctly included in the principal value of the estate of the deceased?"
(3) The controversy between the assessed and the Revenue may now be stated. The assessed had contended that the deceased gifted this amount to his minor daughter on 8th November, 1954, when the money was deported in her name and the will Provided evidence of the said gift having been made on that date. On the other hand, the Revenue maintained that there being no presumption of advancement, the mere deposit by the deceased in the name of his minor daughter did nto prove the gift ; that the gift was made by the will itselt and that there was no evidence indicating the iptention of the deceased that he gifted the money on the date of the deposit. It is in the light of these facts that we have been called upon to answer the question referred Mr. Kirpal, the learned counsel for the Revenue, pressed on us to hold. that the finding of the Board being a pure finding of fact was binding on us and the question should, on that account be answered in favor of the Revenue. He said that the Board had, on the proper appreciation of evidence, come to the conclusion that the gift had been made within two years of Munshi Lal's death. Before Ideal with the facts of the case, it is necessary to discuss the principles which one has to bear in mind in deciding whether or nto a given finding is apure finding of fact or of law or of fact and law.
(4) It is a rule announced in several decisions that the trier of facts having had proved or admitted before him a series offacts, may deduce there from further conclusions which are themselves conclusions of pore fact. The High Court cannto in such a case arrive at its own conclusion. If, on the other hand, a finding of fact arrived at is nto based on any evidence but on conjecture or surmise or where an inference is to be drawn from the facts determined, on the application of any principle of law such a finding maybe subjected to review because in the first case it Would be a question of law and in the ether case, a mixed question of law and fact. Again, the conclusion, though of fact, may be such as could in no case have been arrived at by a judicial mind properly instructed as to the relevant law. In that situation also, it will be a question of law. It is nto in all cases easy to distinguish between a question of law and a question of fact. But a conclusion of fact cannto be indirectly assailed by posing a question "consider whether, as a matter of law, the fact finding authority came toga correct conclusion on a point of fact". The unassailability in all cases belongs only to a finding on aquestion of pure fact and nto to a finding which is mixed question of law and fact. Interpretation of every document does nto necessarily raise a question of law. In Sree Meenakshi Mills Limited v. Commissioner of Income-tax, Madras the Supreme Court considered the various decisions bearing on the question and observed- "WEhave discussed the authorities at great length, as some of the observations contained therein appear, at first sight, to render plausible the contention of the appellant and it seems desirable that the true meaning of those observations should be clarified, lest error and misconception should embarrass and fog the administration of law. The position that emerges on the authorities may thus be summed up : (1) When the point for determination is a pure question of law such as construction of a statute or document of title, the decision of the Tribunal is open to reference to the Court under section 66(1). (2) When the point for determination is a mixed question of law and fact, while the finding .of the Tribunal on the facts found is final its decision as to the legal effect of those findings is a question of law which can be reviewed by the Court. (3) A finding on a question of fact is open to attack under section 66 (1) as erroneous in law when there is no evidence to support it or if it is perverse. (4) When the finding is one of fact, the fact that it is itself an inference from other basic facts will nto alter its character as one of fact. Applying these principles, admittedly there is no question here of construction of any statutory provision or document of title. The issues which arise for determination whether the sales entered in the books of the appellant in the names of the intermediaries were genuine and if not, to whom the goods were sold and for what price are all questions of fact. Their determination does nto involve the application of legal principles to facts established in the evidence."
The Supreme Court approved the following statement of law by the Judicial Committee in Wali Mohammad v. Mohammad Baksh "WHEREthe question to be decided is one of fact, it does nto involve an issue of law merely because documents which were nto instruments of title or otherwise the direct foundation of rights, but were really historical materials have to be construed for the purpose of deciding the question: se Midanapur Zamindary Co. v Uma Charan Mandal."
A second appeal would nto lie because some portion of the evidence might be contained in a document or documents, and the first appellate court had made a mistake as to its meaning : see Nowbutt Singh v. Chutter Dharee Singh.
(5) Misunderstanding of a material document has also been held to be a question of law: see Mahesh Anantrai Pattani v. Commissioner, of Income Tax'. What is the position here ? The absence of presumption of advancement was conceded by Mr. Jaishi Ram Goel and I need nto elaborate on the same. The question whether the deceased gifted the said amount to Niloo in November 1954 must, therefore, depend on the intention of the deceased at the time of the deposit. The will was, of course, nto set up as a document of title or as a document which constituted the direct foundation of any right. It was set up only as a piece of evidence to prove the intention of the deceased at the time of gift. If this document as a piece of evidence had been wrongly read, Mr. Kirpal would have been right in his contention. That however does nto appear to be the position. The Board has arrived at the conclusion that clause 7 of the will shows that .the gift was made at the time of signing of the will. Having read the will that way, the Board found that that excluded the possibility of the gift having been made in November 1954. This decision of the Board is, therefore, based on complete misreading of the will. Clause 7 of the will does nto even remotely suggest that the gift was made by the said will. As a matter of fact, clauses 7 and 8 read together, as they must be, clearly show that the assessed had made the gift before he signed the will. This finding of the Board is, therefore, based nto only on mis-reading of a material document but also on surmise and conjecture. If the Will does nto even remotely bear out the finding of the Board, the decision cannto but be termed as one based on conjecture. In a given case a later Document can provide good evidence of an anterior transaction. If the Will had been susceptible to both the interpretations, I would have been inclined to agree with Mr. Kirpal that the decision of the Board binds me. The only interpretation that can, in my opinion, be placed upon the Will is that the gift had been made earlier. The gift was to a minor daughter. The money had been deposited in the name of the minor and, therefore, the deceased had done all that he could do to carry out his intention of gifting the amount. The case, therefore, does nto fall in line with the decisions that no question of law arises when a fact finding authority wrongly reads a document which is nto a document of title or a foundation of right. In Short, the position is this. The Will is nto at all susceptible to the interpretation placed by the Revenue. It, on the other hand, shows that the gift was made before the signing of the Will. The Board has come to its conclusion on complete mis-reading of the Will which document in fact goes to support the version of the assessed. The misleading of the Will has led the Board to conclude that the gift was made by the Will and could not, therefore, have been made in November 1954. The latter conclusion is consequently nto based on evidence. There is also no evidence to show that the deceased developed the intention to treat the money as a gift when he signed the Will. I am, therefore, of the opinion that the findings arrived at by the Board are open to review by this Court. The materials on the record, namely, the deposit in the name of the minor and the recitals in the Will clearly establish that the gift had been made at the time of the deposit. In my opinion, therefore, the question must be answered in the negative and in favor of the assesses. In the circumstances, however, I leave the partics to bear their own costs.
H. R. Khanna, J.
(6) I agree.