Supreme Court of India
DILHARSHANKAR C. BHACHECHAversusTHE CONTROLLER OF ESTATE DUTY, AHMEDABAD
- Citation
- 1986 INSC 4
- Decided
- 8 January 1986
- Disposal
- Appeal(s) allowed
- Bench
- V D TULZAPURKAR
Holding
Section 29 of the Estate Duty Act, 1953 applies to the case, the joint will is a mutual will, and the surviving spouse had no disposing power over the wife's share, so the estate duty already paid is exempt from further levy.
Summary
The appellant, a grandson and accountable person, paid estate duty on a bungalow that his grandparents had settled by a joint will. After the wife died, duty was paid on her share; when the husband later died, the revenue claimed duty on his half of the property, arguing that he became the full owner and that section 29 of the Estate Duty Act, 1953 did not apply. The central question was whether the joint will was a mutual will that rendered the survivor’s interest irrevocable and whether the husband had any disposing power over his wife’s share. The Supreme Court interpreted the word "since" in section 29 broadly, holding that once duty is paid on a settled property, it cannot be levied again on the surviving spouse, and that the will created a mutual arrangement making the survivor competent only to enjoy the benefit, not to dispose of the property. Consequently, the exemption under section 29 applied and the appellant was not liable for further estate duty. The appeal was allowed, and the appellant was awarded costs.
Issues considered
- The proper construction of the words "paid" and "since" in section 29 of the Estate Duty Act, 1953.
- Whether the joint will executed by the grandparents constitutes a mutual will rendering it irrevocable after the first death.
- Whether the surviving spouse (Kamlashankar) was competent to dispose of the share of the property that belonged to his wife (Mahendraba).
- Whether the exemption under section 29 applies to the second death in the circumstances.
Legislation cited
- Estate Duty Act, 1953s. 2(15), s. 2(16), s. 2(19), s. 29, s. 6
Subjects
Estate dutyJoint willMutual willSection 29 interpretationSettled propertyCompetent to disposeRevocabilitySuccession
Judgment
94
A
DILHARS!IANKAR C. llHACllECHA
v.
THE CONTROLLER OF ESTATE DUTY, AHMEDABAD
JANUARY 8, 1986
B
[V.D. TULZAPURKAR AND SABYASACHI MUKHARJI, JJ.]
Estate Duty Act, 1953 sections 2(15), 2(16), 2(19), 6
and 29 - Interpretation of the words "paid" and "since" in
c section 29 - Joint will and mutual will - Conditions necessary
to render mutual will irrevocable - The theory of contempora-
neous exposition and construction of the will in question.
The appellant Dilharshankar c. Bhachech being one of the
grand-sons of the deceased Kamlashankar Gopalshankar and a
legatee under a joint will of his grand parents is the
accountable person under the Estate Duty Act, 1953. The
D
deceased and his wife Mahendraba each possessed certain ~
properties which were of their own individual ownership. They
were also jointly possessed of certain properties including a
bungalow known as "Dilhar Dwar" - situated in the Ellisbridge
area of Ahmedabad. On 24th December, 1950 the deceased and his
wife had made a joint will in respect of the said bungalow.
E
Mahendraba, one of the executants of the joint will died on
3rd January, 1954. On the death of Mahendraba, estate duty on
her share of the property which passed on her death to her
husband Kamlashankar has been duly paid. Kamlashankar the
other executant to the joint will died, thereafter on 25th
October, 1964. Upon his· death, the appellant-cum-accountable
person-cum-sole executor and trustee paid estate duty to the ~
remaining extent of 50% on the properties as mentioned in the
joint will of the deceased Mahendraba and Kamlashankar. The
appellant accountable persons in the returns filed contended;
(i) since the property in question was settled by the joint /~
will in favour of the grandsons and since duty .had been paid
G
on the death of one of the joint executants to the will, duty
on the second death of the deceased was not payable on the
whole estate by virtue of the provisions of section 29 of the
Estate Duty Act; (ii) that on a true construction of the will,
the deceased was neither at the time of his death nor any time -I
during the continuance of the settlement, the full owner of
the share of the property of Mahendraba because he had only a
D.C. BHACHECH v. THE CONTROLLER 95
A
""\ life interest therein to receive rents and profits from that
share, and therefore, exemption contempfated by section 29 of
the Act came into force and hence no estate duty with regard
to the share of Mahendraba on the death of the deceased
Kamlashankar arose for the second time. The Revenue was of the
opinion that on the death of Mahendraba, the wife, her husband B
had become the sole owner of the property in question, as is
evident from the wealth tax returns filed by him and there-
fore, exemptions under section 29 of the Act cannot be
""' claimed.
Both the Assistant Controller of Estate Duty Ahmedabad
as well as the Appellate Controller held against the account-
able person, taking the view that section 29 of the Estate c
Duty Act was not applicable. Full amunt of the Estate Duty
was collected from the accountable person •. In an appeal before
the Tribunal, the Tribunal on the construction of the will
held in favour of the accountable person, for the reason that
Kamlashankar did not become the full owner of the share of the
property of Mahendraba on her death. D
At the instance of the Revenue the Tribunal referred the
matter to the High Court of Gujarat. While refusing to inter-
pret the word "since" narrowly as contended by the Revenue,
the High Court, however, answered on the construction of the
will in its favour holding that "there was no agreement of
irrevocability and the survivor took an absolute interest in E
the whole of the property and as such section 29 would have no
application to the facts of the case. Hence the appeal by
certificate.
Allowing the appeal by certificate;
Allowing the appeal, the Court F
HELD: l The interpretation sought for by the Revenue was
highly artificial and against the spirit of section 29. Look-
ing at the language and the spirit of section 29 of the Estate
Duty Act, 1953, it was clear that the expression "If the
estate duty has already been paid - - since the date of the G
settlement", occurring in the first part thereof, meant "if
the estate duty has become payable or has been paid .either
simultaneously wi.th the creation of the settlement or at
any time thereafter." The dictionary meaning of the word
'r "since" is wide enough. Section 29 comes into operation only
on the death of the surviving spouse, the obvious intention of H
96 .SUPREME COURT REPORTS [1986] 1 S.C.R.
A the Legislature in framing the section being to avoid double >-
duty. Even if the word "paid" was used in wider context and
not in the literal sense, it could not be interpreted as
excluding its literal meaning, namely, the actual fact of
payment having already been made. Here, on the facts, the duty
had been "paid" since the date of the settlement. [104 A-El
Coutts &Co. v. Inland Revenue Comissioner (1962] 2 All
B E.R. 521 at 527 quoted with approval.
1.2 Whether a person in "competent to dispose of'' of the
property and within the meaning of section 6 of the Estate r
Duty Act, 1953, would naturally depend on the terms and condi-
tions under which the property is either acquired or
inherited. The expression "competent to dispose of" llllSt bear
c the ordinary meaning in the English language. A person shall
be deemed to be competent to dispose of the property if he has
every power or authority enabling the donee or other holder
thereof to appoint or dispose of the property as he thinks
fit. [118 DJ
1.3 The question of ·strict construction of the trucing
D statute and the principle that one who claims exemption must >
strictly come within the purview is not relevant in the
instant case because the exemption follows on the interpre-
tation of the will. In the instant case whether the deceased
Kamlashankar had the disposing power over the share of the
property of Mahendraba, his wife, acquired by him would depend
E not on how he has treated it but the true effect of the will.
There is no question of contemporaneous conduct because the
conduct of one of the parties subsequent to the death of one
of the executants long after the execution of the will cannot
be described as contemporaneous conduct. The question of
"contemporaneous exposition" by conduct of the parties in the
F facts of this case does not arise. (119 E; 116 B-C] ~
2.1 A joint will is a single testamentary instrument
containing the wills of two or more persons and jointly
executed by them, while mutual wills are separate wills of two
or more persons which are reciprocal in their provisions and
G executed in pursuance of contract or agreement between two or
mor.e persons to dispose of their property to each other or to
third persons in particular mode or manner. Mutual wills as
distinguished from joint wills are sometimes described as
reciprocal wills. In order to render mutual will irrevocable, ._,-
D.C. BllACHECH v, THE CONTROLLER 97
A
-I ])oth the conditions lllllst be' concurrently satisfied: (a) that
the surviving testator 11111st have received benefits from the
deceased under the miitual will; (b) the 1111tual wilis should
have been executed in pursuance of an agreement that the
testator shall not revoke the llllltual wills. Such an agreement
not. to revoke the wills may either appear from the wills B
the11Belves or may be proved outside the wills, but that is not
established by .the mere fact that the wills are in identical
terms. If such an agreement is shown, each party remain bound.
[113 D-F; 114 A-C]
A different and separate agreement 11111st be spelled out
not to revoke the will after the death of one of the
executants. That agreement must be ciear, though need not be c
by a separate writing but must follow as a necessary implica-
tion which would tantamount to an express agreement. [118 H;
119 A]
2.2 In the instant case it is clear;
(a) The will in question was a mutual will; [108 Bl
(b) Reading the different clauses of the said will it D
was manifest that the intention was to .keep the prorerty as· it
was at the time of execution of the will so that the ultimate
beneficiaries and the grandsons might enjoy the property with
sue~ modifications as the contingencies of time and situation
might require; [108 A-BJ
(c) Before the death of the first of the executants, the E
agreement remained contractual one in consideration of mutual
promises. It could have been at that stage revoked by llllltual
agreement or even by unilateral breach, giving rise at the
most to an action for damages. But after the death of first
one without revoking his or her own will makes the joint will
irrevocable by the survivor. But there lllllst be an agreement F
that the wills would not be revoked after the death of one of
the executants or disposition will not be made contrary to the
will after the death of one of the executants; [109 C-D, E]
(d) The predominant intention of the executants at the
time of the execution, after the acceptance of the benefit of G
the execution makes the will in this case irrevocable by the
survivor of the executants; [119 A-B]
(e) In the facts and circumstances of this case, because
of the specific clause that it was intended that the grandsons
H
98 SUPREME COURT REPORTS [1986] 1 s.c.R.
A
would recel.ve the· benef1.t i.n species and then bei.og no
provision for making up the def1.ciency or di.minuti.on i.f any,
J.t must follow that there was llll1tuality and Kamlashankar was
not competent to di.spose of the property in any manner
contrary to the ulti.mate di.sposi.tion; (119 B-C]
(f) The fact that estate duty was pai.d is non sequi.tur.;
B
[119 D]
(g) 'The payment of weslth-tax by Kamlashankar
Gopalshankar. on the whole estate after. the death of Mahendr.aba
is no relevant; and [119 D]
(h) The huaband Kamalshankar. received the benefi.t under
the will after the death of Mahendr.aba. It became i.r.r.evocsble
c by him after. her. death with the result that he had no di.spos-
ing power. over. the shar.e of Mahendr.aba i.n the pr.oper.ty. In the
pr.emi.ses being a "settled pr.oper.ty" estate duty havi.ng been
pai.d on the death of one of the par.ties, the accountable
per.son was entitled to exempti.on under. section 29 of the Act •.
[119 F-G]
D
·Dufour. v. Per.ei.ra, [1769] 21 E,R. 332; In re: 01.dbaa,
1925 Ch.75; Gray v. Perpetual Trustee Co. Ltd. (1928] A.c. 391
at 399 & 400; Re Parsons, Parsons v. Attor.ney-General, [1942]
2 All E.R. 496; and Bhavmd. Prasad v. Smt. Surendra Bala W/o
Suboclh Qiandra and Anr. A, I.R. 1960 Allahabad 126 discuased
and distinguished.
KuppullWSlli Baja V• PelUlllal Baja A.I.R. 1964 Madras 291
approved.
CIVIL APPELLATE JURISDICTION : CJ.vll Appeal No, 679 (NT)
of 1974.
F
From the Judgment and order dated 19/20-12-73 of the
G.ujarat High Court J.n Estate Duty Reference No.2 of 1972,
v.s. Desai., DHhar C. Bhachech, NaunJ.t Lal, Kailash Vasu-
_dev and Mrs. VJ.nod Arya for the Appellant,
S.C. Manchanda, c.M. Lodha and Miss. A. Subhashi.nl. for
the Respondent.
The Judgment of the Court wes deUvered by
SABYASACHI MUKHARJI, J, In thi.s appeal by certlfl.cate by -{
H
the HJ gh Court under artlcle 133(1) of the ConstitutJ.on
D,C. BHACHECH v. 1llE CONTROLLER [SABYASACHI MUKHARJI, J,) 99
A
1. aga.!.nst the judgment and or.der. of the IU.gh Cour.t of Gujarat
dated 19/20th December, 1973 l.n Estate Duty Reference No. 2 of
1972, the question l.nvolved l.s regardlng exemptl.on from estate
duty under. sectl.on 29 of the Estate Duty Act, 1953 (her.el.n-
after called the 'Act'), whl.ch contemplates exempti.on from
duty in cases where estate duty has been paid on settled B
property on the death of one of the par.Hes to a marrl.age.
The appellant ls the accountable per.son and he ls
related to the deceased Shrl. Kamlashankar. Gopslshankar.
~. Bhachech as one of his grand sons. Deceased Kamlashankar
Gopslshankar. died on 25th October., 1964. The deceased had a
wife named Mahendraba Kamlashankar. Bhachech. The deceased and
his wl.fe each possessed certal.n proper.Hes whl.ch were of thel.r c
own i.ndivl.dusl o~r.shl.p. They wer.e also joi.ntly possessed of
certain propertl.es includl.ng a bungalow known as 'Dilhar llwar'
- sltusted i.n the Ellis bddge ar.ea of Ahmedabad. The dl.spute
in the r.efer.ence out of which this appeal arose was wi.th
r.egar.d to estate duty leviable on 1/2 share of the wi.fe of the
deceased l.n the said bungalow and the land apper.tal.ni.ng D
thereto. ·
On 24th December, 1950, the deceased and hl.s wi.fe had
made a jol.nt will l.n respect of the sal.d bungalow. They also
made separ.ate wi.lls wl.th r.egard to their lndl.vl.dually owned
pr.oper.tl.es on the same date with whl.ch thl.s appeal ls not
concerned. E
The aforesaid bungalow is sl.tuated on Plot No. 825 and
.appertal.nl.ng to Its mai.n structure· there ar.e blocks beadng
Nos. 48/2 to 48/6, In addi.tl.on to the blocks, there l.s a
gar.age, a bath r.oom and two latr.l.nes· as also some open
compound land apper.tal.nl.ng to the mal.n str.uctur.e. All these
pr.aper.ti.es wer.e disposed of by the jol.nt wi.ll executed by the F
·• deceased and hl.s wi.fe. The relevant por.tl.on of the jol.nt wl.ll
is as under.:-
"Dur.Ing our. li.fe tl.me we shall conti.nue ,to be jol.nt
owner.a of the land bungalow and blocks wl.th thel.r.
common bath r.oom and two prl.vl.es l.ncludl.ng the G
gar.age bear.Ing No. 48/1 and shall be joi.ntly
entl.tled to the r.ents and Income of the said land
and blocks and the user. and r.ent of the bungalow.
After the death of one of us, the sur.vl.vor. shall
become the owner. of the said land bungalow and
H
100 SUPREME COURT REPORTS [1986] 1 s.c.R.
A
blocks J.nCluding the garage No. 48/1 wHh the said .•
bath room and privies and shall become enti.tled to
the rents and Income and user of the said land
bungalow and blocks including garage No. 48/ 1 and
the bath room and pri.vles, The provi.si.ons herein-
after contal.ned shall become effective after the
B death of the survivor of us. After the death of
the survivor of us, hereby devise and bequeath our
said furru shed Bungalow includi.ng all things,
articles, fumHure, utensils, fi.xtures etc. r
together wJ th the porti.on of the land and compound
walls deH.neated on the plan hereto annexed and
c coloured red and marked 'B' to our grandson Dl.lhar-
shankar Chl.ntanvanshankar Bhachech. We hereby
devis.e the bequeath our block Nos. 48/2 to 48/6
Including garage beari.ng No. 48/1 wJ.th the said
bath room and pri.vles together wJ.th the porti.on of
the land and compound walls dell.nested on the plan
hereto annexed and coloured blue and marked 'C' to
our Grandson SnehHshankar Chintavanshankar
Bhachech. We hereby devise and bequeath the portl.on
of the open land and the compound walls deHneated
on the plan hereto annexed and coloured green and
marked 'A' to our grandson Hasi.tshankar Drupad-
E shankar Bhachech.".
Mahendraba Kamlashankar Bhachech one of the executants of
the Joint Wl.11 died on 3rd January, 1954. On the death of
Mahendraba, estate duty on her share of the property wl:ll.ch
passed on her death to Kamlashankar Gopalshankar has been duly
paid. TW.s ls an admi.tted positi.on. Kamlashankar Gopalshankar
F died, thereafter, on 25th October, 1964. Upon lll.s death, the
appellant cum accountable person cum sole executor and trustee "'
paid estate duty to the remai.ning extent of 50% on the proper-
ties menti.oned in the above menti.oned joint wJ.ll of the
husb.and and the wJ.fe. The case of the revenue was that on the
death of Mahendraba, the wl.fe, the deceased Kamlashankar
G Gopalshankar, the husband, had become the sole owner of the
property i.n questi.on and that he had filed his wealth ta.x
returns accordi.ngly. The case of the appellant-accountable
person was that since the property in questi.on was settled by
the joi.nt wl.ll in favour of the grandsons and si.nce duty had
been paid on the death of one of the joint executants to the --{
H wl.11, duty on the second death of the deceased was not payable
on. the whole estate by vfrtue of the provisi.ons of secti.on 29
D,C, BHACllECH v·;· THE CONTROLLER [SABYASACHI MUI<HARJI, J,] 101
of the Act. It was further contended that on a true construe-
A
-\ ti.on of the wHl, the deceased was nefther at •the time of his
death nor any time during the conti.nuance of the settlement,
the full owner of the share of the property of Mahendraba
because he had only a ll.fe Interest therein to receive rents
and profl.ts from that share, and, therefore, exempti.on
contemplated by sectl.on 29 of the Act came Into force and the
revenue was not entitled to levy any estate duty w:i.th regard B
to the share of Mahendraba on the death of· the deceased,
~.
Kamlashankar Gopalshankar. The questi.on, therefore, that arose
before the revenue authoriti.es as well aa the Hl.gh Court, was,
whether the appellant herel.n was Hable to pay estate duty on
1/2 share whl.ch the deceased possessed or on the whole includ-
ing the share which the w:i.fe of the deceased had l.n the
property. c
Both the Assl.stant Controller of Estate Duty, Ahmedabad
as well as the Appellate Controller held against the account-
able person and further held that sectfon 29 of the Act was
not appll.cable. Full amount of the estate duty was collected
'-{ from the accountable person, There was an appeal before the
Tribunal. The Trl.bunal on the conatrucdon of the w:i.ll held in D
favour of the accountable person. The Tribunal held that the
deceased Kamlashankar Gopalshankar dl.d not become the fUll
owner of the share of the property of Mahendraba on 'her death,
At the· instance the revenue, the Td.bunal referred the
follow:ing questi.on of law to the Hl.gh Court:
''Whether, on the facts and l.n the cl.rcumstances of E
the case, the Tribunal was right ln holding that
the respondent is endtled to the full benefl.t
conferred by sectl.on 29 and that as such no estate
duty in respect of the half share l.n the joint
..< property whl.ch orl.ginally belonged to late
Mahendraba, the wife of the deceased l.s payable by F
the respondent?"
The aforesal.d reference was answered by the Hl.gh Court in
favour of the respondent by its judgment and order dated
19/20th December, 1973 and gave a certl.fl.cate of fl.tness of
appeal to this Court. ·
· It, l.s necessary l.n thl.s connecti.on to refer to sectl.on 29 G
of the Act which reads as follows:
H
102 SUPREME COURT REPORTS (1986] 1 s.c.R.
A
"Settled property Jn respect of whl.ch slnce the i-
date of the settlement estate duty has been pal.d on
the death of the deceased'• spouse.
29. If estate duty has already been pald Jn respect
of any settled property since the date of the
settlement, on the death of one of the partles to a
B mardage, the estate duty shall not be payable Jn
respect thereof on the death of the other party, to
the mardage, unless the latter was at the tlme of
hl.s death, or had been at any tl.me during the
contlnuance of the settlement, competent to dl.spose
• of such property, and, H on his death subsequent
c Hnrl.tatlons under the settlement take effect ln
respect of such property, was sul juds at the tlme
of lrls death, or had been sul jurls at any time
wlrl.le so competent to di.spose of the property."
'Settled property' has been defined Jn sectlon 2(19) of
D
the Act as follows:- ).
"2. In thls Act, unless the context otherwi.se
requlres,-
x x x x x
E
x x x x x
(19) "settled property" means property whl.ch stands
li.nrl.ted to, or in trust for, any persons, natural
or juddl.cal, by way of successfon, whether the
settlement took effect before or after the
comnencement of thls Act; and "settlement" mearup._
F
any dlsposJ.tl.on, l.ncludlng a dedl.catlon or
endowment, whereby property Is settled."
Sectlon 2(15) states:
"'Proper.ty 1 1.ncludes any J.nterest ln property,
movable or lumovable, the proceeds of sale thereof
and any money or investment for the ti.me being
G
representlng the proceeds of sale and also species
i.nto another by any methos."
Sectlon 2(16) states:
"'Property passlng on the death' includes property~
passlng elther foJUediately on the death or after
H
D.C. BHACllECH v. THE CONTROLLER [SABYASACHI MUKHARJI, J.] 103
A
any Jnterval, elther certal.nly or contJ.ngently, and
el.ther orl.gl.nally or by way of substl.tutlve llml.ta-
t:f.on, and "on the death" :f.ncludes "at a per:i.od
ascertainable only by reference to the death."
Sectl.on 5 p·rovldes for levy of the estate duty J.n the B
case of every person dyl.ng after the coDJDencement of the Act
. upon the prJ.ncl.pal value ascertal.ned Jn the manner stl.pulated
thereln. Sectlon 6 states that the property whJ.ch the deceased
was at the tl.me of hl.s death competent to dl.spose of shall be
deemed to pass on hl.s death. Sectl.on 6 is J.mportant Jn thl.s
connectl.on because J.n order to attract the levy of the estate
duty, the deceased should have been competent to dl.spose of c
the property. Therefore what law requl.res J.s that the deceased
whose death attrncts the duty must have had dJ.sposJ.ng power at
the tJ.me of hl.s death, One of the J.mportant questJ.ons J.nvolved
Jn thl.s appeal J.s whether the deceased Kamlashankar Gopal-
shankar had dl.sposing power over the entl.rety of the property
whl.ch was the subject matter of the wj.11 by the jol.nt D
.._ executants.
Two contentl.ons were urged before the llJ.gh Court. The
f:f.r.st contenti.on was on the correct :fnterpretati.on of sect:i.on
29 of the Act atid the second contentl.on was on the true
construction of the joJ.nt wl.11 made by the deceased Kamla-
shankar Gopalshankar and hl.s wl.fe Mahendraba Jn the year 1950. E
On the fl.rat pol.nt, the provJ.sJ.on of sectl.on 29 of the Act has
been notlced. It was submJ.tted on behalf of the revenue before
the High Court that sectl.on 29 came Jnto operatlon only where
the estate duty had become payable "al.nee the date of the
settlement". It was contended that the expressl.on "SJnce the
date of the settlement" clearly J.ndl.cated that the settlement F
--'. J.n questl.on should fl.rat come J.nto exl.stence and duty should
have become payable subsequent to the com.Ing J.nto exlstence of
the settlement. The revenue poJ.nted out that J.n the J.nstant
case J.t was contended by the accountable person that the
settlement J.n favour of the grandsons came J.nto exl.stence · on
the death of Mahendraba, then Jt was not possl ble to accept G
the posJ.tion that lJ.abJ.lJ.ty to pay estate duty came J.nto
exl.stence subsequent to the settlement because any liabHJty
to pay the estate duty would also come Jnto exl.stence exactly
at the moment of the death of the deceased.
It was pol.nted out on behalf of the revenue that
\- "settleme'lt" and "ll.abl.Uty to pay estate duty" both had come H
J.nto exJ.stence sl.multaneoualy on the death of Mahendraba and
104 SUPREME COURT REPORTS [1986] 1 S.C.R,
A
l.f that was so, secti.on 29 had no appll.cati.on to the facts of I--
this case. It was urged on behalf of the revenue before the
Hi.gh Court that the word "pai.d" should be read as "payable"
whi.le construi.ng secti.on 29 of the Act. Thi.s i.nterpretati.on
whi.ch the revenue wanted to place on the secti.on was confi.ned
B only to the first part thereof whi.ch stated that 'the estate
duty has already been pai.d' i.n respect of settled property
si.nee the date of the settlement on the death of one of the
parti.es to the marri.age, then the estate duty shall not be ,_
payable i.n respect thereof on the death of the other party to
the marriage. This argument was, however, not accepted by the
c High Court. The Hi.gh Court observed ·that looki.ng at the
. language and the spi.ri.t of the section, i.t was clear that the
expressi.on "l.f the estate duty has already been pai.d .... since
the date of the settlement" meant" l.f the estate duty had
become payable or has been pai.d either simultaneously wi.th the
creati.on of the settlement or at any ti.me thereafter", So the
D High Court emphasised that the di.cti.onary meani.ng of the word
"since" is wi.de and the fact is that secti.on comes i.nto ).
operati.on only on the death of the survivi.ng spouse and the
obvious i.ntenti.on of the legi.slature i.n framing the secti.on
was to avoid double duty. That i.ntenti.on, the court observed,
would be frustrated lf the word "si.nce" was i.nterpreted
E narrowly as contended for by the revenue. Even i.f the word
"pai.d" was used i.n wi.der context and not i.n the li.teral sense,
l.t could not be Interpreted as excludi.ng l ts Hteral meani.ng,
namely the actual fact of payment havi.rig already been made.
The High Court was of the vi.ew that i.nterpretati.on sought for
by the revenue .was hi.ghly artl.fl.ci.al and agai.nst the spi.ri.t of
F the secti.on. We are i.n agreement wi.th the Hi.gh Court on thi.s
poi.nt. The Hi.gh Court referred to the analogous provi.si.on of >
section 5(2) of the Engll.sh Statute and followed the observ-
ations of Upjohn L,J, i.n Coutts & Co. v. Inland llevemle
Comaissioner, [1962] 2 All E.R. 521 at 527, We are also i.n
respectful agreement wi.th the sai.d observati.ons referred to by
G the Hi.gh Court and on the facts, it must be held that the duty
had been "pai.d" al.nee the . date of the settlement. No
submi.ssi.on to the contrary was made before us.
The second contenti.on was on the constructi.on of the.
wi.11. Construi.ng the wi.ll i.n the surroundi.ng ci.rcumatancea and
i.n the ll.ght of the language used the Hi.gh Court was of the
H vi.ew that there was no agreement that the survi.vor shall not --!
revoke the wi.11 or do anythi.ng to di.mi.ni.sh the quantum of the
property goi.ng into the hands of the subsequent legatees.
D.C. BHACHECH v. THE CONTROLLER [SABYASACHI MUKHARJI, J.J 105
Therefore the · deceased as survl.vor took absolute Interest l.n A
-I the property and secti.on 29 of the Act would have no appUca-
Uon to tlrl.s case. The ques ti.on was accordlngly. answered i.n
favour of the revenue and ln the negati.ve.
The constructl.on of the wl.11 l.s the mal.n questl.on i.n tlrl.s
appeal. Whether the accountable person l.s Uable to pay estate
duty on ·full value of the whole property l..e. the .share B
belongl.ng to ·Mahendraba as well as Kamlashankar Gopalshankar
would depend upon the constructl.on of the wl.11 l.n questi.on
-. read in·the light of secUon 29 of the Act. The secti.on to .be ·
appUed requfres payment of estate duty, l.n respect of the
'settled property' on the death of one of the partl.es to the
marriage. Whether property ln quesUon here was settled
property or not would depend upon the constructl.on of the C
wl.11.
The questl.on that fell for consl.derati.on by the Hi.gh
Court and also falls for consl.deraUon J.n . thl.s Court is
whether the deceased Ksmlashanksr Gopalshanksr who survived
lrl.s wHe, one of the jolnt executants to the wl.11, was
.(_ competent to dl.spose of the share of Mahendrabs will.ch he ha!i D
J.nhedted under the ssl.d wl.ll. Therefore, the questi.on l.s whilt
l.s the true mes."ll.ng and effect of the wl.ll? DJ.d the deceased
Ksmlsshankar Gopalshankar have any 'dl.sposl.ng power' over the
property will.ch J.s the subj_ect matter of the wl.ll?
On behalf of the accountable person, J.t was contended
that the Wl.11 l.n queaUon was not merely a, jolnt Will but a E
Will wh:l.ch was jolnt as well as mutual contal.ni.ng redprocal
agreements between the parUes mald.ng the Will and therefore
the deceased Ksmlashankar Gopalshankar had no power l.n Ill.a
Hfe time to revoke or alter the dl.spoal.tl.on made ln the Will
or to do anytlrl.ng inter viwa after the death of Mahendraba
....which ·would have gone sgal.list the ulti.mate di.apositl.on F
l.ndicated l.n the WJ.ll, It was, subml.tted that there was an
lmpHcl.t agreement between the deceased and lrl.s wife, that on
the consideration of. each other agreeing to bequeath his or
her share l.n. the property in favour of the survl.vors each
undertook not to do anythl.ng will.ch would render the subsequent
and ultimate bequest ln favour of grandsons J.neffectl.ve. And G
if such was the agreement, it must follow that what the
deceased received as a legatee was not foll ownerslrl.p rl.ght of
dl.spoaal but only a liml.ted J.nterest l.!r the share of the wife
\.. and thl.s would be so even when both executants and the
• survivor were descrl.bed J.n the Wl.li as 11 owner".
H
106 SUPREME COURT REPORTS [1986] 1 S.C.R.
A
It was submitted that if this construction of the Will
was accepted, there came into existence a resulting settlement~
in favour of the grandsons on the death of the wife and hence
the property became 'settled property' within the meaning of
section 2(19) of the Act. It was pointed out that tf it was
accepted as a 'settled property', the accountable person was
B entitled to exempt.ton under section 29 of. the Act because
admittedly duty was once paid on it on the death of Mahendraba
in the year 1954. Reliance was placed before the High Court on
behalf of the accountable person on the decision in the case;-
of Dufour v. Pereire, [1769] 21 E.R. 332, as well as
Kuppuswaml Raja v. Perumal Rama, A. I.R. ! 964 Madras 291.
C According to the revenue on the other hand, the Will was
joint one pure and simple and there was no evidence of any
mutuality. It was contended that there was enough evidence in
the language of the will itself to show that the survivor was
to acquire full ownership rights over the property and was
therefore competent at all times on the first death to revoke
D the Will or dispose of the property inter vivos.
The High Court on an exhaustive consideration of all the>-
relevant judgments and authorities came to the conclusion that
there was no evidence -to prove any agreement not to revoke the
Will after the death of one of the executants. The High Court
was of the view that there was no external evidence and so far
E as the internal evidence was concerned, it appeared to the
High Court that each of the executants might have thought that
it was quite safe to trust the other and to believe that
having regard to their ages and their affection for the grand
children who were the ultimate beneficiaries, nothing was
likely to occur in the near future which would substantially
F diminish the property taken by the survivor who can be trusted
to give effect to the wishes of the deceased. Therefore;'
~ccgrding to the High Court, there was no agreement of irrevo-
cabiitty and the survivor took an absolute interest in the
whole of the property and as such section 29 would have no
application to the facts of this case. In that view of the
G matter, the High Court answered the question in the negative
and in favour of the revenue.
It is the correctness of that decision which is under
challenge in this appeal. The sole question in the background
of the provisions of the relevant sections namely section 29
read with other sections that have been referred to herein--!
H
D.C. llHACHECH v. THE CONTROLLER [SABYASACHI MUKHARJI, J.] 107
before, is, whether lt wa$ merely a joint Will or it. was a- A
"' joint and Dlltual Will or in other words there was agreement
implied between the parties namely the executants of the Will
not to revoke the Will after the death of one of the
e:Xecutants. It-. is, therefOre, appropriate to refer to the
relevant provisions of the Will. The Will was jointly executed
by Kamlashankar Gopalshankar and Mahendraba on 24th December, B
1950 and described as "last joint Wil_l and testament". They
appointed the accountable persnn the apppellant herein, as
'our Executor'. The Will thereafter goes on to say:
--. ''We are that joint, owners of a Bungalow known as
'Dilhar Dwar' situate at Ellis Bridge, Pritam Nagar
bearing _Plot No. 825, Bungalow No. 48/A. In
addition to the main bungalow there are certain C
other blocks bearing Nos. 48/2 to 48/6 _and one
garage bearing No. 48/1 which is below Block No.
48/2 and a common bath room and two privies for
blocks No. 48/2 to 48/6. We have been in possession
of the land, the bungalow and the blocks for many
years past. We are in actual occupation of the main D
• bungalow. The other blocks except the garage· .bear-
ing No. 48/1 and Block No. 48/5 are rented to
tenants. The garage bearing No. 48/1 is for the
present allowed by us to be used by our ·permission
and leave and licence by our son "Chintvanshankar
Kamlashankar Bhachech without payment of ·ariy sum." E
Then the will goes on to make the bequest in favour
of the three grandsons in terms set ~Ur . . h~rein
before.
The will thereafter goes on to provide in detail for the
contingencies that might happen in case where either by the F
' rules of the Town Planning Scheme or the Municipal Laws the
portions of the property need and require alterations. The
will further stipulates in detail about the payment of the
house taxes in respect of the pro'perties coming to the shares
of each of their grandsons, and even in respect of the areas
built by them. The will further stipulates that for the G
purpose of partitioning the land as demarcated on the plan
there to annexed and ref erred to above if there was any
obstruction on the land going to the share of each of their
grandsons which encroached _upgn the portion or portions coming
\- to the share of other grandson or grandsons the saine should be
removed by the persqI\ or - persons whose encroachment or H
obstruction, it may be.
108 SUPREME COURT REPORTS [19861 l s.c.R.
A
Reading the dl.fferent clauses of the sald joint w:l.ll it ,..
was mani.fest that the intenti.on was to keep the property, as
H .was at the time of executi.on of the w:I ll so that the ulti-
mate benefl.ciaries and the grandsons may enjoy the property i.n
full w:l.th such modlfi.catfons as the conti.ngencl.es of ti.me and
situati.on ml.ght requl.re.
B . In thl.s background l.t is necessary to fl.nd out whether
the Wl.11 in questl.on was a joint will only or a joint and
mutual Wl.11.
Theobald on 'Wl.11~', Twelfth Edl.tl.on, pages 28 & 29 at ;.-
paras 79 & 80 descdbes the dl.fference thus:
"Joint w:l.lls. Persons may make jol.nt wJ.lls, whl.ch
c are, however, revocable st any ti.me by either of
,. them or by the survl vor. A j ol nt wHl ls looked
" upon as the w:l.ll of each testator, and may be
proved on the death of one. But the survivor w:l.ll
be treated l.n equity as a trustee of the joint
property l.f there is a contract not to revoke the
D wl.11; but the mere fact of the executl.on of a joint
wl.11 ls not suffl.cl.ent to estsbHsh a contract not ~
to revoke. So a legacy to a legatee who survived
the fl.rat testator, but predeceased the second, did
not lapse. Where s joint w:l.ll l.s followed by a
separate w:l.ll whl.ch is condl.ti.onal on a condl.tl.on
E that fal.ls, the joint wl.11 l.s not revoked even
though the subsequent separate w:l.ll contains a
r.evocati.on clause.
Mutual wills. The term "mutual w:l.lls" is used to
descdbe separate documents of a testamentary
character made as the result of an agreement
F between the parti.es to create lrrevocable interests>
in favour of ascertalnable benefl.cl.arles. The revo-
cable nature of the wl.lls under whl.ch the interests
are created l.s fully recognised by the Court of
Probate; but in certaln clrcumstances. the Court of
Equl.ty w:l.ll protect and enforce the interests
G created by the agreement despl.te the revocatl.on of
the w:l.ll by one party after the death of the other
w:l.thout havl.ng revoked hl.s wl.ll.
The Court of Equl.ty wHl not protect the benefl-
clsry under mutual wl.lls merely because they have -I
H been made l.n almost identl.csl terma. There must be
D,C, BHACHECH v. THE CONTROLLER [SABYASACHI MUKHARJI, J,] 109
A
evi.dence of an agreement to create interests under
the mutual wllls which are Intended to be J.rrevo-
cable after the death of the Urst to di.e. Where
there i.s no such evl.dence the fact that the
survivor takes an absolute Interest l.s a factor B
agai.nst the i.mplicatl.on of such agreement. Where,
however, the evidence is. clear, as, for example,
where i.t is contai.ned i.n recl.tals in the wills
themselves, the fact that each testator gave the
other an absolute Interest w:l.th a substi.tutl.onal
gl.ft i.n the event of the other's pd.or death does
not prevent the court of Equi.ty from affordl.ng l.ts c
protecti.on to the benefi.ci.ary under the mutual
w:l.lls. The agreement must also be sufficl.ently
precl.se to be enforced by the Court.
Before the death of the first to die, the agreement
l.s a contractual one made in consideratJ.on of D
:l, mutual proml.ses. It can, therefore, at thi.s stage
be revoked by mutual agreement· and even by
uni.lateral breach, gi.vl.ng. ri.se to an acti.on for
. damages at least where the revokl.ng party gl.ves
such notJ.ce to the other as may enable hi.m to alter
hi.s w:l.11 also. But on general princl.ples only the E
partJ.es to the agreement can sue for damages for
wii.lateral breach."
Earl Jowi.tt l.n the DictJ.onary of English Law, lst Edn.
Second lmpressl.on 1965 at page 1283, referes to the defini.tl.on
of 'owner' under Public Health 1936 and the Factori.es Act,
1937 as a person for the ti.me bei.ng receiving the rack-rent of F
• the preml.ses in connectl.on w:l.th whl.ch the word i.s used,
whether. on hls own account or. as agent or trustee. Jow:l.tt also
defi.nes 'ownership' as the most extensi.ve right allowed by law
to a person, of deaHng wi.th a thi.ng to the exclusl.on of all
other per.sons, or of all except one or more speci.fi.ed persons.
It is therefore a right In rem. G
Stroud' s Judi.cl.al DictJ.onary 4th Edn. Vol.3 page 1907
deals wi.th the concept of 'owner' and 'ownership' l.n different
statutes of England.
llalsbury's Laws of England, 4th Edn., Vol. 50 at pages 95
')- & 96, paras 207 & 208 de_als more or less in the same manner
about joint wi.ll and mutual w:l.ll. But at page 108, para 221 i.t H
states the law thus:
110 SUPREME COURT REPORTS [19861 i s.c.R.
A
"221. Restrictions by taking a benefit under a '"
llltllal will. Mutual wills may be made, either by a
joint will or by separate wills, in pursuance of an
agreement that they are not to be revoked. Such an
agreement may appear from the wills, or may be
proved outside the wills, but it is not established
B by the mere fact that the wills are in identical
terms. If no such agreement is shown, each party
remains free to revoke his will, if there are ;.-
separate wills, or to revoke the joint will, so far
as it disposes of his property, and the fact that
one party has died without revoking the disposition
c of his property does not prevent the survfvor from
revoking the disposition which he has made notwith-
standing that he has received benefits out of the
estate of the deceased party. Even when there is
such an agreement and one party has died after
departing from it by revoking or altering the will,
D· the survivor having notice of the breach cannot ~
claim to have the later will set aside, since·the
not'tce gives him the chance of altering the will as
regards his own property; and the death of the
deceased party ts itself sufficient notice for this
purpose. It, however, the deceased has stood by the
E agreement and not revoked or altered his will, the
survivor ts bound by it, and although probate will
be granted of a later·will made by him in breach of
,. the agreement, since a court of probate is only
concerned with the last will, the personal
representatives of the survivor nevertheless hold
F his estate in trust to give effect to the provi- >·
sions of the joint will or mutual wills."
Jarman on Wills in 8th Edn. at page 42 states the
position of U11tual wills thus:
"The fact that a husband and wife have siml-
taneously made mutual wills, giving each to the
G other a life interest with similar provisions in
remainder, is not in itself evidence of an agree-
ment not to revoke the wills; in the absence of a
definite agreement to that effect there is no
implied trust precluding the wife from making a -(
fresh· will inconsistent with her former will, even
H though her husband has died and she has taken the
benefits conferred by his will. Although by . the
D.C. BHACHECH v. THE CONTROLLER [SABYASACHI MUKllARJI, J.] 111
A
lllltual wills the wife expressly has ref rained from
exercising a- power of appointment, which her
husband had only in default of her exercising it,
and he has appointed, the wife can both take the
benefit of her husband's will and exercise her
power of appointment, unless the language of his B
will either puts her to her election, or place her
in the position of seeking at the same time to
approbate and reprobate its provisions.
The joint executants have been described as joint owners.
Again the said clause goes on to .use the expression 'during
our life time we shall continue to be the joint owners' 'and
shall be jointly entitled to the rents and income of the sai.d c
land and blocks and the user and rent of the bungalow. The
Will goes on to say that after the death of one of them
'survivor shall become the "owner 11 of the said land bungalow
and blocks including the garage with the said bath room and
privies and shall become entitled to the rents and income and
• user of the said land bungalow and block's. The provisions D
contained in the said will were stipulated to be effective
after the death of the survivor of them. After the death of
the survivor the will went on to use the expression "we hereby
devise and bequeath our said furnished bungalow ••••• " Then the
will made petalled provisions for the enjoyment of the
property in specific species. E
In re Oldham, 1925 Ch. 75, the husband and wife had made
mutual wills in the same form in pursuance of an agreement so
as to make them but there was no evidence of any further
agreement in the matter. Each· gave his or her property to the
other absolutely with the same alternative provisions in case
•.of lapse. The wife having survived and accepted her husband's F
property under the mutual will subsequently married again, and
made a fresh will ignoring the alternative provisions of her
own mutual will. The plaintiff in that case contended that
from the agreement to make mutual wills in the form in which
they were made, the survivor who had accepted the benefit
under the mutual agreements became thereby subject to alter- G
native trusts mentioned in the mutual wills. Reliance was
placed on Dufour v. Pereira (supra). Reference was made to the
observations of Astbury J. in that where the learned judge
\- observed that in order to enforce the trust, the judge llllst be
satisfied that there was a term irrevocable and in such
H
112 SUPREME COURT REPORTS [1986] 1 s.c.a.
A
cl.rcumstances he was to gi.ve effect to the same. But the ·'"
learned judge was unable having read the w:l.11 to fi.nd any
mutuali.ty in that form In the w:l.11 in questi.on. This decl.slon
found favour with the Gujarat Hi.gh Court. In the Instant case
before· us, it has to be noted that the will in questi.on was in
one document and furthermore the desire to give properties In
B specl.es to the grandsons was manifest from the entirety of the
w:l.11.
'· It would be evident from the said w:l.11 that the j oi.nt r
proper,Ues of the deceased husband and the w:l.fe were
deli.nested into three parts and each of the parts were
bequeathed to three grandsons in sped.es i.,e; In speci.fi.c
C d"marcated areas. One other slgnlfi.cant fact to be borne in
mi.nd, in vlew of the contenti.ons involved in thi.s appeal, is
the fact that there was no provisi.on in the will whereby H
one of the properti.es or one of the parts of the sai.d proper-
ti.es was parted away or di.mini.shed before the death of both
the executants ( thi.s ls Important because the w:l.11 was to take
D effect on the death of both the executants), there was no ).
provi.si.on that any part whi.ch got dimini.shed duri.ng the li.fe
time of one of the executants, he should be compensated other-
wi.se from any other part of the said properti.es or any other
assets of the estate of the executants which were the subject
matter of the w:l.11.
E Reli.ance was placed i.n Gray v. Perpetual Trustee Co.
Ltd,, [1928] A.C. 391 at 399 & 400. In that case it was held
that the fact that husband and w:l.fe si.multaneously made mutual
wi.lls gi.vi.ng li.fe Interest w:l.th si.mi.lar provi.si.ons in the
remai.nder was not :i.n :l.tself evj.dence to an agreement not to
revoke the w!.lls.
F The use of the expressi.on 'owner' ls really not the'·
soluti.on of the problem before us In thi.s appeal. In one
.context the expressi.on 'owner' has been used to indi.cate the
limi.ted ownershlp to be enjoyed by the survlvor of the jolnt
executants and in another context .to the ulti.mste legatees or
r the benef:l.cj.arles.
G
Clause 5 of the w:l.11 i.s suggesti.ve that i.t was i.n the
contemplati.on of the executants as to what would happen to
certain amounts lylng to their credi.t at the ti.me of the death
of the survivor. Jn the event of the: death of the grandson "-'
before the dea".h of the survl.vor of the executants. It '
H
D.C, BHACHECH v. THE CONTROLLER [SABYASACHI MUKHARJI, J,] 113
A
provl.ded that J.n that event the amounts would go to the heirs
according to law of the grandson named therei.n. These proper-
ti.es were agal.n i.n clause 7 descrl.bed as 'joint properti.es'.
It would be material to refer·, apart from the clauses
wh:i.ch have been set out herei.nbefore, to certaln other clauses
namely clause 2 of the will, the relevant portl.on of whl.ch has B
been set out herei.nbefore i.n its entirety. Clause 3 deals wi.th.
the situati.on when J.f any of the grandsons or the hel.rs. wanted
to sell h:i.s or thel.r portl.on of bulldi.ng at any tl.me. Clause 4
also dealt wl.th the situstl.on l.f one of the grandsons dl.ed
dudng their ll.fe ti.me and before the death of the survl vor
what would happen? Clause 5 has been referred to herel.nbefore.
Clause 6 deals wi.th certai.n movable propertl.es. Clause 7 dealt c
wlth separate propertles.
It l.s evident from the afor~said that property in
species, in specl.flc proportl.on, was Intended to be preserved
and enjoyed by the ulti.mate legatee on the death of the
survlvor.s.
In Kuppuswamy Raja v. Perumal Raja (supta)·, It was D
observed that a joi.nt wl.11 is by a single testamentary instru-
ment contal.nl.ng the wi.lls of two or more persons and jol.ntly
executed by them, whlle mutual wllls, ar.e separate wi.lls of
two or more persons whfch are recl.procal l.n thel.r provl.sl.ons
and executed J.n pur.suance of contr.ac.t ·or agr.ee.ment between two
or more pe'rsons to dl.spose of thel.r property to each other to E
thl.rd person l.n partl.cular mode or manner, Mutual wl.lls as
dl.stingul.shed from jol.nt wi.lls are sometl.mes descrl bed as
reciprocal wi.lls, In descrl.bl.ng a wi.11, the adj ectl.ve mutual
or. r.ec:l.pr.ocal i.s used to denote the contractual element whj ch
distl.ngul.shed from a jol.nt wl.11. It was stated thereln by the
Dl.visl.on Bench of the Madras High Court that jolnt will would
become :l.r.r.evocable on the death of one of the testators :If the
survlvor recel.ved beneflt under the wi.ll. The Court emphasl sed
referring into certal.n decl.sl.ons of thl.s court that a joJnt
will would become Irrevocable on the death of one of the
testators l.f the survlvor has recel.ved beneflt under the
mutual wi.ll. There need not be any specHlc contract proh:ibl- G
tl.ng evocatlon when the agreement took the form of not two
sl.multaneous mutual wi.lls but one sl.ngle document. If one
si.ngle document was executed usi.ng the expression 'our
\. property' , 'our pr.esent w:f.shes' , and 1as· w:f 11' and such
· si.milar expressions, i.t was str.ong cogent evidence of the
i.ntention that there was no- power. to revoke except by mutual H
consent.
114 SUPREME COURT REPORTS [19861 1 s.c.R.
A
In order to render mutual will irrevocable, bath,
according to the said decision, the conditions must be
concurrently satisfied:
(a) that the surviving testator must have received
benefits from the deceased under the mutual will; (b) the
mutual wills should have been executed in pursuance of an
B agreement that the testators shall not revoke the mutual
wills. Such an agreement not to revoke the wills may either
appear from the wills themselves or may be proved outside the
wills. This judgment was dissented from by the judgment under
appeal.
Reliance was placed on the decision of the Atlahabad
c High Court in Bhawani Prasad v. Smt. Surendra Bala W/o Subodh
Chandra and another, A.I.R. 1960 Allahabad 126. In that case,
by the will both the executants, husband and wife were devis-
ing the property of which each was the owner, in the first
instance to whoever survived, and thereafter both of them
devised the property 'belonging to us' to the petitioners.
D There was an assertion of absolute ownership in the house made
by the wife, and an assertion made by both executants that the
deposits in the bank constituted money 'belonging to us the
executants'. Tiie itemc; aforesaid, according to the will, were
to remain in the absolute possession and enjoyment of the
executants during their life time and thereafter to be
E disposed of in the manner indicated in fhe will. The last
clause, clause (4) of the will indicated that the executants
would have the right to amend or cancel the will, but nobody
else would have that right. It was found that the exercise of
the right of the power reserved by clause ( 4) was not made
dependent by this clause on the co-existence of both the
F executants. It was held on the construction of reading of the
will that after the death of the husband, the wife could
revoke the part of the will by gifting away t)le house to
another during her life time. The fact that the,wife had bene-
fitted from the will of tlle husband would not destroy her
power of revoking her will because her will was quite an
G independent transaction. The deed of gift' could not be taken
to have revoked the will of the husband but only the will of
the wife. The case was really decided in term-; of the facts
and circumstances of that case and "o'd!ngs of the will.
In the case of Re Parsons, Parsons v. Attorney General,
-I
[1942] (2) All E.R. 496, the testatri:.t gave a legacy of '
H f-10,000 to her husband absolutely, and :,,he also gave the
D.C. BHACHECH v. THE CONTROLLER [SABYASACHI MUKllARJI, J.] 115
A
income of her residuary estate on trust for her huaband for
life and after his death on trust for her son absolutely. The
husband disclaimed the legacy by a formal deed of disclaimer
and the legacy fell into residue. On the husband's death the
revenue authorities claimed estate duty in respect of the
legacy on the groµnd that although the husband had disclaimed B
the legacy, he was competent to dispose of it and the
liability to duty was not, therefore, excluded by the Finance
Act, 1948. ·It was held that during the period between the
death of the testatrix and the date of the disclaimer the
husband was 'competent to dispose' of the legacy within the
meaning of the Act. Whether a person is competent to dispose
of naturally would depend on the terms and conditions under c
which the property is either acquired or inherited. The
expression 'competent to dispose of' DllSt bear the ordinary
meaning in the English language. A person shall be deemed to
be competent to dispose of the property if he has every power
or authority enabling the donee or other holder thereof to
appoint or dispose of the property as he thinks fit. D
A contention was raised in this connection whether this
being an exemption provision from duty, it should be so read
as to· lean in favou:r of the ·assessee.
The questions whether such a clause should be construed
in f avoUr of the assessee or in favour of the revenue in case
of doubt or the question whether section 29 being exemption E
clause in respect of payment of duty on •ettled property, -the
onus is on the assessee. to come strictly within the purview of
that clause or the question how should such a provision be
construed really do not arise. There is not much difficulty or
ambiguity on the construction of _section 29 of the Act. The
_.. . question involved in this case is the constructi.on of the will F
in question. Was it only a joint will executed jointly by two
·of the executants or was it a joint and a mutual will? In aid
of the submissions that an exemption clause· must be strictly
construed in favour of the State cases were cited which need
not therefore be noticed.
G
Reference was made to Cross 'Statutory Interpretation'
on construction on the theory of contemporaneous exposition
reliance being placed on the conduct of the parties t.e. the
deceased and treated the half share of the wife in the pro-
perty in question as his own and had filed wealth tax returns
on the same basis. H
116 SUPREME COURT REPORTS (1986] i s.c.R.
A
These prlncl.ples are also well settled. But these
prl.ncl.ples wUl not strktly be appUcable Jn the Instant case
because thl.s appeal J.s concerned wl.th the constructlon of the
wi.11 i.n questl.on and the wi.ll Jn· questl.on must be construed l.n
such a manner as to fl.nd out the true Jntentlon of the
executants or the testator and testatrix. For that i.t J.s well
B settled that wlll must be read as a whole. Secondly the
expression must be read consistently.
One has to bear Jn ml.nd that we are concerned wi.th the r
constructi.on of the wUl and the true effect of the provi.sl.ons
thereof. Whether the deceased .Kamlashankar Gopalshankar had
the disposing power over the share of the property of
c Mahendraba, hl.s wi.fe, acquJ.red by h.l.m would depend not on how
he has treated i.t but the true effect of the wi.11. Furthermore
there l.s no questl.on of contemporaneous conduct because the
conduct of one of the partles subsequent to the death of one
of the executants long after the executl.on of the wi.11 cannot
be descri.bed as 1 contempor.aneous conduct:'. We need not, there-
D for.e, detai.n ourselves on the questlon of 'corttemporaneous
exposl.ti.on' by conduct of the parties In the facts of thl.s
case.
Therefore the wi.11 must be construed i.n J.ts proper Ught
and there must be defi.nl.te agreement found from the tenor of
the wi.11 or all.unde that either of the joint executants would
E not revoke the wi.11 after recei.vi.ng the benefi.t under the
wi.11. Such defi.ni.te agreement need not be express; l.t can be
l.mpli.ed. The terms of the wi.11 have been set out exhaustively.
It was undoubtedly a jol.nt wl.11. The property ln questl.on has
1
been descr:f.bed as 'our proper.ty' • The express:f.on owner' has
also been used l.n the manner J.ndl.cated in the Bentence 'During
F our life ti.me we sha 11 contl.nue to be the j oi.nt owners of the >-
land bungalow and blocks wJ th thei.r common bath room and two
privl.es .... and shall be joi.ntly enti.tled to the rents and
Income of the sal.d land and blocks and the user and rent of
the bungalow', The wi.11 goes on further to say that on the
death 'of one of them, the survi.vor shall become the 'owner of
G user of the sal.d land bungalow and blocks l.ncludl.ng
garage ••••• ' Therefore i.t i.s clear that the ownershi.p whJ.ch
the jol.nt executants contemplated was the user durl.ng the Hfe
tlme and entl.tlement to the rents and income of the same. It
J.s th.l.s ownershi.p wh.l.ch was to pass on the death of ei.ther of -.f
them to the survi.vor and the wl.11 thereafter goes on to say
H
n.c. BllACHECH v. THE CONTROLI.ER [SABYASACHI MUKHARJI, J.] 117
that 'the provl.sJ.ons hereinafter contained shall become A
effecti.ve after the death of the survivor of us'. And there-
after after the death it l.s provided "we hereby devl.se and
bequeath our sal.d furnJ.shed bungalow ..... " The gl.ft of the
property to the three grand chl.ldren as owners· ln full sense
l.s to take effect on the death of the survivor of both the
executants. It Is clear that the property was intended. to be B
kept in tact for the enjoyment of the ulthnate legatees and
during the life ti.me of el.ther of them the property would not
In any way be parted wi.th or di.mi.nJ.shed. Thi.a l.ntentJ.on,
expressed in the l.mpli.ed terms in the bargain in the wUl, l.n
our opinJ.on, would be fortl.fied by devising the property to
three grand chl.ldren In sped.es J..e. in speci.fl.c form and not
providing for any money or compensatJ.on for dl.udnutJ.on of .any c
part thereof before comi.ng into effect of the wUl in
questJ.on, If that is the posi.tJ.on then, ln our opini.on, there
l.s a definJ te agreement not to revoke the will by one of the
executants after he or she has received the benefl.t under the
wi.11 on the death of el.ther of them.
Indubi.tably in the i.nstant case the husband has recel.ved D
the benefft under the wl.11 of the wi.fe, He could not have
during his Hfe ti.me parted wi.th the property i.e. he did not
have the dl.sposi.ng power over the proper.ti.es in question after
the death of the wHe.
It was emphBsl.sed that there was no evidence of
mutuality, But there was enough evi.dence in the language of E
the wl.11 Itself whl.ch have been set out herel.nbefore that the
property must remain i.n tact speci.ally after receipt of
benefft by one of the· executants on the death of the other
unti.l the death of both of them to be able to be succeeded by
., the ultl.mate legatees, The domi.nant i.ntenti.on of the testators
is evl.denced from the language used. Thi.a must be judged in F
the facts and ci.rcumstances of each case. It was not only that
on certai.n basis that the wi11 was made but l.t was Intended to
remai.n i.ntact to be enjoyed by the grand chl.ldren. The fact
that both the executants have described themselves 1 joint
owners 1 i.s not by Itself conclusive on this poi.nt nor the use
of the expressJ.on 'that the survi.vor. shall become the owner 1 G
i.s conclusi.ve. On the other hand the detal.led provi.si.ons 1.n
speci.es to be effecti.ve after the death of the survivor i.n
di.fferent porti.ons to be gl.ven to. the di.fferent grand sons
'"' wi.thout any provi.sion as to what was to happen J.n case of the.
di.mi.nutl.on of the property wi.thl,n the H.fe ti.me of ei.ther of
the survivor make the wi.11 'mutual wills 1 , H
118 SUPREME COURT REPORTS [19861 1 s.c.R.
A
In our opl.ni.on the doml.nant Intention ls clear I.e. the
wl.11 may be revoked during the Hf e tl.me of both the
executants but after the death of one of the executants and
after benefH had been received by the survivor, the property
in quest Ion must remaJn Intact to be enj ayed by the grand
B chlldren by the terms of the wl.11 whlch was to become
effecti.ve on the death of both of the executants.
We are of the opJnfon ,that defl.nl.te Jntentfon musi: be
there but such Intention need not be expressed J.n a separate
document than the wlll Itself. If from the wl.11 l.n questl.on
such a defl.nl.te Jntenti.on and a separate agreement can be
c spelled out then Jn our opJni.on It would be a case of jol.nt
and mutual wJ 11.
In vlew of the above dlscussl.on, the followl.ng proposl.-
ti.ons follows:
l. Whether estate duty ~s payable on the whole of the
property or not would depend on whether the deceased Kamla-
shankar Gopalshankar had 'dl.sposl.ng power' over the share of
Mahendraba Jnherl.ted by hl.m on her death or not?
2. The above questi.on would depend on the constructl.on >
of the joJnt wl.11-dld l.t create any mutuallty among the
executants of the j olnt wl.11? Whether Kamlashankar Gopal -
shankar having accepted the benefl.t and after hls wl.fe's
E death, was competent to do anythl.ng contrary to the ultl.mate
bequest? Before the death of the fJrst of the executants, .the
agreement r.emained contractual one· 1.n consi.der.atlon of mutual
proml.ses. It could have been at that stage revoked by mutual
agreement or even by unUateral breach, gl.vlng rl.se at the
wost to an actl.on for damages. But after the death of the
F fl.rst one wl.thciut revokl.ng hl.s or her own wl.11 makes the jol.nt
wl.11 Irrevocable by the survl.vor (See Theobald . (supra1', But
there must be an agreement that the wl.lls would not be revoked '
after the death of one of the executants or dl.sposltl.on wl.11
not be made contrary to the wl.11 after the death of one of the
executants. Such an agr.eement may appear from the w:l.11 or. ·may
G be proved outside the wi 11 but that J.s not estabHshed by .the
mere fact that the wJ.lls are in ldentl.cal t.erms. If such an
agreement i.s shown, each party rema:i.n bound.
3. A di.fferent and separate agreement must be spelled
out not revoke the wlll after the death of one of the·
H executants. That agreement must be clear though need not by a ..(
D,C, BllACHECH v. THE CONTROLLER [SABYASACHI MUKllARJI, J,] 119
A
separate wdtl.ng but must follow as a necessary J.mpHcati.on
whl.ch would tentamount to an express agreement.
4. The predomi.nant J.ntentl.on of the. executants at the
ti.me of the executl.on, after the acceptance of the benefi.t of
the execution makes the wHl in thi.s case frrevocable by the
sur.vi.vor of the executants. B
s. Judged by the prl.ncl.ples J.ndl.cated above, i.n the
facts and cl.rcumstances of thi..s csse, we are of the opi.ni.on
because of the specl.fi.c clause that J.t was Intended that the
grandsons would recei.ve the benefi.t J.n sped.es and there bel.ng
no provl.si.on for maki.ng up the defi.cl.ency or di.mi.nuti.on If
any, it must follow that there was mutuall.ty and Kamlashankar
Gopalshankar was not competent to dl.spose of the property J.n c
any manner contrary to the ultiJDate dl.sposi.tl.on.
6. The fact that estate duty was pai.d is ~ ·sequi.tur.
7. The payment of wealth tax by Kamlashankar Gopal-
shankar on the whole estate after the death of Mahendraba J.s
not relevant. D
.t 8, The questl.on of std.ct constructi.on of the taxi.ng
statute and the pdnci ple that. one who clal.ms exempti.on must
strl.ctly come wi.thin the purvi.ew J.s not relevant in thi.s case
because the exempti.on follows on the i.nterpretati on of the
wi.ll.
E
In that vl.ew of the matter we are of the opini.on that
thi..s was a mutual wi.ll. The husband Kamlashankar Gopalshankar
recel.ved the, beneflt under the wi.ll after the death of
Mahendraba. It became Irrevocable by hiw after her death.
Therefore he had no di.sposl.ng power over · the share of
·Mahendraba l.n the property. In the premi.ses bel.ng a 'settled F
• property', estate duty having been pal.d on the death of one of
the par.tles' the accountable person was enti.tled to exempti.on
under sec ti.on 29 of the Act. In the premises the High Court
was not ri.ght in l.ts conclusi.on.
The appeal l.s accordl.ngly allowed and the judgment under G
appeal Is set asl.de and the questl.on is answered in the
afflrmatl.ve and in favour of the accountable person. The
accountable per.son j s enti.tled to the costs of tW s appeal.
S.R. Appeal allowed.
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