MR. GIBSON BOWLES (Lynn Regis)I beg to ask Mr. Chancellor of the Exchequer whether the opportunity, which he understood on 9th February would shortly arise, has yet arisen for testing by the High Court the question whether the Finance Act, 1894, charges estate duty at the death of a life tenant of 1566 settled property when that life tenant has surrendered his life interest in such property within twelve months of his death; and, if so, when a decision of the question may be expected?
§ THE CHANCELLOR OF THE EXCHEQUER (Sir M. HICKS BEACH, Bristol, W.)A case has arisen in which this question can be tested, and the matter will be brought before the High Court of Justice as soon as possible; but when a decision may be expected must depend on the state of business in the Court.
MR. GIBSON BOWLESI beg to ask Mr. Chancellor of the Exchequer whether he has given attention to the decision of the House of Lords in "Earl Cowley v. Commissioners of Inland Revenue," whereby it was decided that when the tenant for life and the remainderman have disentailed a settled estate, have then charged the estate with a mortgage debt, and have subsequently re-settled the estate, the Finance Act, 1894, does not charge estate duty upon the total principal value of the estate as passing on the death of the life tenant, but only upon what remains of that value after the mortgage debt has been deducted therefrom; whether any estate duty not charged by the Act has actually been demanded by and paid to the Commissioners of Inland Revenue in similar cases, through the refusal of the Commissioners to allow such mortgage debts to be deducted in such cases from the total principal value of the property passing; if so, whether he can state approximately in how many instances such duty has been exacted and paid in, and since, 1894; and whether, in all such cases, the duty so paid will now be returned?
§ THE CHANCELLOR OF THE EXCHEQUERI am not prepared to accept the first paragraph of the Question as a complete statement of the Cowley case, the circumstances of which were somewhat peculiar. Nor can I 1567 say how many cases there have been which involve the point decided in. it. It is believed, however, that the number of such cases is very small. If it is found that in any cases similar to that of Earl Cowley the duty has been paid without allowing for the deduction of the mortgage, the duty erroneously paid will be returned; but in very few, if any, instances has duty been actually paid in such cases.