SECTION 52 – PAYMENT OF DUTY BY
TRANSFER OF PROPERTY
1546. Provisions of the section are not resorted to frequently by estate duty authorities because of administrative problems
Query : Section 52 states that the Central Government may, on an application of the accountable person, accept in satisfaction of the whole or any part of such duty any property passing on the death of the deceased at such price as may be agreed upon between the Central Government and that person, and thereupon such person shall deliver possession of the property to such authority as may be specified by that Government in this behalf.
This provision which enables an accountable person to pay estate duty in kind remains on the statute book without implementation and without any attempt to relieve the burden of the accountable person. In a case where a large amount of estate duty was payable and a large part of the estate consisted of immovable property, i.e., lands in respect of which the State Government had served an order of acquisition for public purpose, the accountable person applied to the Controller of Estate Duty to accept that property, at a fair value. Without going into the details of the valuation of the property, the Estate Duty Controller has refused to accept that property. Although the Controller has been good enough to give time for payment of estate duty, it does not help because the property is under “acquisition of the State Government”. The State Government is not moving in the matter to complete the acquisition proceedings. It is “sitting pretty” because there is nothing in law which can compel it to complete the acquisition proceedings within any reasonable time. In the meanwhile, interest at 4 per cent is levied by the Controller of Estate Duty. It is submitted that in this case no interest should be charged as the land is not yielding any income. The provisions of section 52 are meant to relieve the genuine difficulty of the accountable person and are not meant to remain on the statute book only. It should not appear that the Government will agree to take over such property and at such price, which will give large income. In this regard, it is suggested that in computing the market value of the property for the purpose of estate duty and wealth-tax, the assessee should have a right to give over the property to the Government at assessed value in payment of the taxes.
Answer : Chairman remarked that the provision was not resorted to frequently mainly because of the administrative problems. He further said that till the valuation organisation was built up properly no improvement was likely.
Source : Relevant extracts of minutes of discussion with Chairman, CBDT at meeting with IMC, Bombay on 27-9-1971 – Reproduced from IMC’s Journal – December 1971 issue.
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