COMMISSIONER OF WEALTH TAX Vs. CHIKMAGALUR CLUB

JUDGEMENT

(1.) SINCE the parties in these reference proceedings are common, and since the issues involved are inter-related, both these cases are heard together and disposed of by this common order.

(2.) FACTS in Income-tax Referred Case No. 120/1998 (Old TRC Nos. 120-123/1998) are as under : the assessee is a club registered under the provisions of Karnataka Societies Registration Act, 1960. For the asst. yrs. 1980-81, 1981-82, 1982-83 and 1983-84, the assessee-club had filed the return of wealth in the status of AOP declaring net wealth of Rs. 'nil'. Rejecting the claim made in the returns filed, the WTO had assessed the wealth of the assessee in the status of individual and charged wealth-tax, under the provisions of the WT Act, 1957 ('act' for short ).

(3.) IN the appeals filed against these assessment orders, it was the stand of the assessee-club, that it is an AOP and not liable for payment of wealth-tax. Reliance was placed on the decision of the tribunal for the earlier assessment years in the assessee's own case, wherein it was held that it was not liable to wealth-tax in view of the language employed in the charging provision, namely, section 3 of the Act. The first appellate authority has allowed the assessee's appeals for the asst. yr. 1980-81 and insofar as asst. yrs. 1981-82, 1982-83 and 1983-84 are concerned, keeping in view the provisions of Section 21aa of the Act, which has been inserted in WT Act by Finance act, 1981, w. e. f. 1st April, 1981, has noticed in his order that :