COMMISSIONER OF INCOME TAX Vs. D. MEENAKSHI

JUDGEMENT

(1.) THIS appeal is by the revenue challenging the concurrent findings of the Commissioner of Wealth -tax (Appeals) -II, Bangalore which has been confirmed by the Income Tax Appellate Tribunal, Bangalore Bench in WTA 44/Bang./2002 raising the following substantial questions of law: 1. Whether the appellate authorities were correct in holding that the assessee's share in the Body of Individuals in which he was a member cannot be brought to Wealth Tax as his share was not determinate on the valuation date?

(2.) WHETHER the interest held by the assessee in a body of individuals can be brought to wealth tax in accordance with Rules 15 and 16 to 20 of III Schedule to the Wealth -tax Act read with Section 4(1)(a) of the Wealth -tax Act especially when the Hon'ble Supreme Court in M/s. Meera and Company, Ludhiana etc. Vs. Commissioner of Income Tax, Punjab, J and K and Chandigarh, Patiala, AIR 1997 SC 1973 has held that Association of Persons' and 'Body of Individuals' is not something distinct and separate, but, is a composite unit liable to tax?

(3.) THE assessee filed return of wealth for the relevant assessment year. The same was processed under Section 16(3) of the Wealth -tax Act. Assessing Officer noticed that the assessee was a member of number of Body of Individuals under a Trust Deed and that his interest in the properties of Body of Individuals has not been accounted for the purpose of wealth tax in the return filed by the assessee. It was also noticed by the Assessing Officer that Body of Individuals in which assessee was a member was dissolved on 12 -9 -1993. The respective shares of the assessee on dissolution of these Body of Individuals was considered for computation of share and therefore the Assessing Officer passed an order computing wealth tax including the share of the assessee under the Body of Individuals. This order was questioned by the assessee by filing an appeal before the Commissioner of Wealth Tax on the ground that the assessee did not had any definite share in the Body of Individuals and that the order of assessment was bad in law. Commissioner of Appeals after hearing the parties held that in terms of the trust dead wherein the assessee is a member of several Body of Individuals, share of the assessee was undeterminable and cannot be assessed to wealth tax in respect of the assessee's interest in the Body of Individuals. Accordingly, the order of the Assessing Officer was set aside and the appeal was allowed. Aggrieved by the order passed by the Commissioner of Wealth -tax Appeals, revenue filed an appeal before the Income Tax Appellate Tribunal. The Tribunal relying upon the trust deed produced by the parties held that there are 10 sets of Body of Individuals and that the person's constituting respective Body of Individuals were alone beneficiaries under the trust deed and that the shares of each of the beneficiaries is neither determinate nor specific and that they are variable and further held that the only surviving beneficiaries on that date of revocation of the trust deed are entitled to share. Therefore, accepting the findings of the Wealth -tax Commissioner, dismissed the appeal. Being aggrieved by the concurrent findings, present appeal is filed by the revenue.