M. Ct. Muthiah and anr. Vs. Deputy Controller of Estate Duty, Southern Zone

M. Ct. Muthiah and anr. vs Deputy Controller of Estate Duty, Southern Zone

Disposition Appeal allowed Court Chennai Decided Nov 13, 1963

~3 min read

https://sooperkanoon.com/case/797444

For advocates & juniors · 7-day free trial

Brief this judgment before chambers

Stop skimming 50 pages - get an 18-section AI Brief on this case, ask scoped follow-ups, and find related precedents with Semantic Search. Full trial, no card required.

18-section brief - facts, issues, ratio, relief
Ask this case - answers cite the judgment
Semantic search - find precedents by meaning
Research drawer - sections, cites, related cases

Citation: sooperkanoon.com/797444
Court: Chennai High Court
Judge: S. Ramachandra Iyer, C.J. and ;Ramakrishnan, J.
Decided On: Nov 13, 1963
Case Number: Writ Appeal No. 270 of 1962
Subject: Direct Taxation
Disposition: Appeal allowed

Case Summary

AI-generated summary - not the official court judgment text.

- - There can obviously be no failure to pay when the accounting party had still time till the end of that day to pay the amount. such an order would be tantamount to an anticipation of failure on the part of the accounting party to pay up the duty. Penalty can be lowed only on failure to pay duty;

Key legal issue: Direct Taxation
Outcome / disposition: Appeal allowed
Acts & sections: Estate Duty Act, 1953 - Sections 73

Parties & Advocates

Appellant / Petitioner

M. Ct. Muthiah and anr.

Advocate R.H. Seshadri and ;V. Thiyagarajan, Advs.

Respondent

Deputy Controller of Estate Duty, Southern Zone

Advocate S. Ranganathan, Adv.

Legal References

Acts: Estate Duty Act, 1953 - Sections 73
Reported In: AIR1964Mad364; [1963]48ITR1(Mad)

Excerpt

- - there can obviously be no failure to pay when the accounting party had still time till the end of that day to pay the amount. such an order would be tantamount to an anticipation of failure on the part of the accounting party to pay up the duty. penalty can be lowed only on failure to pay duty;.....be no failure to pay when the accounting party had still time till the end of that day to pay the amount. therefore the order levying the penalty cannot be regarded as valid.3. srinivasan, j. appears to have thought that by an earlier letter the accounting party was directed to pay immediately and the time given till 5-3-1959 would not avail him. this view in our opinion is not supported by the terms of the letter of the deputy controller dated 24-2-1959, on which reliance has been placed, and the relevant portion of which runs thus:'please note that if the duty is not paid immediately, in any case on or before 5-3-1959 i shall be constrained to resort to the penal provisions of the act.'far from supporting the case of the authorities, it is clear that the accounting party was given time till 5-3-1959 to deposit the balance duty payable. it will therefore be incompetent for the deputy controller to pass the order levying the penalty in the case; such an order would be tantamount to an anticipation of failure on the part of the accounting party to pay up the duty. penalty can be lowed only on failure to pay duty; not in anticipation of it. the appellants are entitled to the issue of a writ in terms prayed for, and, the order levying penalty will be quashed. there will be no order as to costs.

Full Judgment

S. Ramachandra Iyer, C.J.

1. This appeal arises out of proceedings initiated under Article 226 of the Constitution with regard to a penalty imposed on an accounting party under the provisions of the Estate Duty Act It is unnecessary to set out in detail the history of the levy of the duty and of the payment made towards it. On the death of the father of the accounting party the estate was assessed to duty and a sum of Rs. 1,29,749.54 was found due after credit being given to a payment of a small sum. This the accounting party was directed to pay before 10-1-1959. A substantial portion of the amount, viz., Rs. 1,10,965.31 was paid within the time permitted. The accounting party then approached the authority for the grant of time for the payment of the balance. That authority granted time till 5-3-1959.

2. It will be apparent from the order granting time that the accounting party was entitled to pay the balance before the close of the day on 5-3-1959, till which date the authority itself has given time. Curiously enough on the 5th itself the Deputy Controller made an order levying a penalty of Rs. 11000 for non-payment of the balance of duly due. There can obviously be no failure to pay when the accounting party had still time till the end of that day to pay the amount. Therefore the order levying the penalty cannot be regarded as valid.

3. Srinivasan, J. appears to have thought that by an earlier letter the accounting party was directed to pay immediately and the time given till 5-3-1959 would not avail him. This view in our opinion is not supported By the terms of the letter of the Deputy Controller dated 24-2-1959, on which reliance has been placed, and the relevant portion of which runs thus:

'Please note that if the duty is not paid immediately, in any case on or before 5-3-1959 I shall be constrained to resort to the penal provisions of the Act.'

Far from supporting the case of the authorities, it is clear that the accounting party was given time till 5-3-1959 to deposit the balance duty payable. It will therefore be incompetent for the Deputy Controller to pass the order levying the penalty in the case; such an order would be tantamount to an anticipation of failure on the part of the accounting party to pay up the duty. Penalty can be lowed only on failure to pay duty; not in anticipation of it. The appellants are entitled to the issue of a writ in terms prayed for, and, the order levying penalty will be quashed. There will be no order as to costs.

Same Parties M. Ct. Muthiah and anr. vs Deputy Controller of Estate Duty, ... Same Subject Direct Taxation Same Judge S. Ramachandra Iyer, C.J. and ;Ramakrishnan, J. Acts & Sections Estate Duty Act, 1953 - Sections 73

Direct Taxation