COMMISSIONER OF WEALTH TAX BOMBAY Vs. MICHEL POSTEL

JUDGEMENT

(1.) The only question that arises for decision in these appeals is whether the High court was justified in rejecting the application of the department to call for a statement of case from the tribunal along with the question of law:

(2.) In these appeals we are concerned with the valuation of the assessee's wealth during the years ending 31/03/1960, March 31/03/1961 and Ma 31/03/1962. One of the points contested by the department related to the computation of the value of the shares held by the assessee in two companies viz. Franco indian Manufacturers Pvt. Ltd. and Franco Indian Pharmaceutical Pvt. Ltd. To both these companies, Section 23-A of the Indian Income Tax Act, 1922 or its corresponding provision in the 1961 Act could be applied if the conditions prescribed therein are satisfied. It was found by the tribunal that the provision was applied during the assessment year 1961-62. For the assessment year 1960-61 tax under S. 23-A was paid under a settlement. In calculating the break-up value of the shares in these companies, the assessee wanted the additional super-tax leviable under S. 23-A of the Indian Income Tax Act, 1922 or leviable under S. 104 of the Income tax Act, 1961 to be deducted in addition to. the deduction of other liabilities. The Wealth Tax Officer rejected that claim. In appeal, the Appellate assistant Commissioner allowed the deductions. The tribunal upheld the decision of the Appellate Assistant Commissioner.

(3.) From the facts set out above, it is quite clear that the question of law formulated by the department did arise for consideration. The tribunal erred in opining that its finding that the additional tax payable under section 23-A is deductible, is a finding of fact. Hence the tribunal was wrong in refusing to refer that question for the opinion of the High court under S. 2 7 (1) of the Act. The High court also erred in not calling upon the tribunal to refer that question for its opinion alongwith a statement of case.