Report No. 52
2. Point for consideration.-
The point to be considered relates to the date of valuation under the Estate Duty Act with respect to property compulsorily acquired. It is well known that estate duty is leviable on property passing on death. As regards computing the value for the purposes of this duty, the principal provision1 in the Estate Duty Act provides-
"36. Principal value how to be estimated-(1) The principal value of any property shall be estimated to be the price which, in the opinion of the Controller, it would fetch if sold in the open market at the time of the deceased's death".2
(Rest of the section is not material for purposes of this Report).
Now, hardship may result in cases where the property subject to duty is compulsorily acquired without compensation, or for inadequate compensation, after it has passed on death to the person accountable. The person accountable for the duty under the Act has, notwithstanding such acquisition, to pay duty on the full value of the property, though he has virtually obtained nothing or has obtained something less than the full value. We may note that the Ministry3 concerned is broadly in agreement with the idea underlying the suggestion for the amendment of the Estate Duty Act made in the draft Report. It has, however, mentioned that it is not aware of any enactment whereunder any property can be acquired without compensation.
1. Section 36(1), Estate Duty Act, 1953.
2. Emphasis supplied.
3. Government of India, Ministry of Finance, (Department of Revenue & Insurance), File No. 134(18)/72-TPL.