JUDGMENT
Vinod Kumar Gupta, J.
1. With regard to the estate left by the late Hena Roy Chowdhury, who died on March 51, 1975, a dispute has arisen between the parties regarding the value of the estate and the estate duty which the petitioners as the legal heirs of the deceased are liable to pay thereupon.
2. The case of the petitioners is that they are liable to pay duty on the value as returned by them, i.e., Rs. 2,23,222.22, whereas the respondents have passed the impugned order whereby the estate duty has been levied on the two portions of the property valued at Rs. 2,71,500 and Rs. 1,90,000. This value was arrived at on the basis of the valuation report submitted by the valuation cell.
3. The petitioners’ short grievance is that while passing the impugned assessment order on June 25, 1987, the respondents totally ignored and overlooked the circular issued by the Central Board of Direct Taxes, vide their Instruction No. 1758. This instruction was issued on 15/19th May, 1987. It means that as on the date of the passing the impugned order on June 25, 1987, the instruction in question was admittedly in operation. In other words, it also means that the Assessing Officer was obliged to follow the instructions while disposing of the valuation case of the petitioners.
4. It is worthwhile to reproduce the entire instruction which reads thus :
“Instruction No. 1758 summary assessment of estate duty cases
Reference is invited to the Board’s Instruction No. 1658, dated October 30, 1985, on the above subject. The matter has been further considered and it has been decided that the following instructions may be followed :
(i) Henceforth in all cases where the returned principal value does not exceed Rs. 7.5 lakhs, the assessment should be completed under Section 58(1);
(ii) In all cases of returned principal value not exceeding Rs. 7.5 lakhs where notices under Section 58(2) have already been issued, the assessments may be completed under Section 58(3) in the manner as if they were assessments under Section 58(1) ;
(iii) If for any special reasons the Assessing Officer is of the view that compliance with the instructions (i) and (ii) above in any particular case would be highly detrimental to the Revenue, he may, with the prior approval of the Controller of Estate Duty, proceed to complete the assessment in normal course ;
(iv) The instructions (i) and (ii) above would not be applicable to the cases falling under Section 58(4) ;
(v) No penalty proceedings be initiated in the cases covered under summary assessment scheme as per Board’s letter No. 296/29 of 1985-ED, dated January 14, 1986.”
5. A very plain reading of the instruction clearly reveals that in all cases where the returned principal value did not exceed Rs. 7.5 lakhs, the assessment should have been completed in terms of Section 58(1) of the Estate Duty Act, 1953. In those cases, however, where a notice was issued upon the person accountable under Section 58(2) of the Act, the instruction said that the assessment should be completed under Section 58(3) of the Act, but in the manner as if the assessment proceeding was under Section 58(1) of the Act. The instruction also stated that if for any special reasons the Assessing Officer is of the view that compliance with the instructions Nos. (i) and (ii) in any particular case would be highly detrimental to the Revenue, he may with the prior approval of the Controller of Estate Duty proceed to complete the assessment in the normal course. In other words, as per Clause (iii) of the instruction, the Assessing Officer was given a discretion that if in a particular case he feels that the returned value even though not exceeding Rs. 7.5 lakhs, was furnished by a person accountable to defeat the interests of the Revenue, or ex facie it was totally absurd, it was open to him not to comply with the Instructions Nos. (i) and (ii), but to proceed in the normal course under Section 58(2) of the Act.
6. Undoubtedly, in the present case before us, the Assessing Officer has not taken recourse to this provision of law and he has gone ahead to dispose of the valuation case in accordance with paragraphs Nos. (i) and (ii) of the instructions. Even though he has, on his own showing, decided the valuation case on the basis of the instruction, yet he committed an illegality and a patent error in relying upon the valuation report of the Valuation Officer, which he was not permitted to do. Instructions Nos. (i) and (ii) clearly enjoined upon the Assessing Officer to take the valuation returned by the person accountable as true and correct and to pass the assessment order based on that valuation and assess the estate duty leviable thereon. The intent of the authority issuing the instruction was very clear. It was that in every case where the valuation did not exceed Rs. 7.5 lakhs, the Assessing Officer had no option but to take that valuation as correct and to assess the duty leviable thereon, except in the eventuality as indicated above where he felt that the valuation as returned would be highly detrimental to the interests of the Revenue.
7. A perusal of the impugned assessment order leaves me in no doubt that the Assessing Officer, by patently misinterpreting the instruction and by unnecessarily importing the valuation report, has gone contrary to the spirit of the instruction and thus the impugned order clearly stands vitiated.
8. For the foregoing reasons, therefore, this petition is allowed. The impugned order is set aside to the extent it has levied estate duty on the basis of the valuation returned in the valuation report by the valuation cell. The respondents are directed by issuance of a writ of mandamus to levy estate duty upon the estate left by the deceased on the basis of the valuation as returned by the person accountable and not on any other basis.
9. If the person accountable or any other person on their behalf has already paid the estate duty on the aforesaid basis, needless to say there will not be any further liability on her part to pay any other amount towards the estate duty.
10. There shall be no order as to costs.
11. All parties to act on a xeroxed signed copy of this dictated order on the usual undertakings.