Controller of Estate Duty vs Jalal Sayyedur Rahman (Accountable person of late Sri Jalal Khalilur Rahman)

R. Jayasimha Babu, J.—The question referred to us is under the repealed Estate Duty Act, 1953. The question is regarding the applicability or otherwise of Section 12 of the Act to the facts of this case.

One Jalal Khalilur Rahman died on June 30, 1977. He had created a wakf in the year 1947 and the terms had been recorded in the deed executed in the year 1965. Under that deed by Clause 10, he had clearly categorically declared that he had divested himself of the ownership of the property. The other clause inter alia provided for the appointment of mutawalli, the said Rahman being the first mutavalli. His son was to succeed him in that office after the father''s life time. The benefit of the wakf was for the descendants of Rahman and when the family had become extinct would go to the Mosque named in the deed.

The Appellate Controller of Estate Duty as also the Tribunal on these facts have rightly held that the value of the property which was dedicated to the wakf the property being the tannery at Ambur, did not form part of the estate of the deceased Jalal Khalilur Rahman as he had not reserved to himself any right or power to reclaim the absolute interest in the property settled in the wakf, nor had reserved to himself any interest in the property for life or any other period determinable with reference to his death.

Counsel for the Revenue contended that his becoming a mutawalli itself amounted to reservation of the benefit of the wakf. The terms of the deed clearly show that he had not only divested himself of the title but also declared that he would not receive any income for himself. Moreover, the holding of the post of mutawalli is completely different from being the owner of the property in his individual capacity. That altered legal status cannot be a factor in holding that the person who created the wakf had retained his rights solely by reason of his becoming the mutawalli, for the purpose of Section 12 of the Estate Duty Act.

We, therefore, answer the question, namely :

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is correct in law in holding and had valid materials to hold that the assessee had validly transferred the property comprising a tannery to the wakf in 1947 and accordingly in excluding the value of the property from the value of the estate of the deceased ?"

against the Revenue and in favour of the assessee.