HANDI V C Vs. WEALTH TAX OFFICER

JUDGEMENT

(1.) IN this writ petition, the petitioner has challenged the order made by the Commissioner, Bangalore, rejecting part of the claim of the petitioner in a revision petition filed before him under s. 25(1) of the W.T. Act, 1957, in relation to the assessment to wealth-tax for the assessment year 1974-75. The order of the Commissioner is dated January 28, 1976, a copy of which has been filed as Ex. "C" in this writ petition.

(2.) THE petitioner filed his return his return in the status of an HUF for the said year on February 18, 1975, and the WTO made an assessment on June 27, 1975, under s. 16(3) of the Act. In the course of the assessment, the petitioner claimed a deduction in regard to income-tax and wealth-tax liabilities for the assessment years 1966-67 to 1974-75. He claimed the said liabilities as a debt outstanding due and that they were allowable as the assessments in that behalf were made only on June 27, 1975. THE WTO, however, allowed deduction of only the wealth-tax liability for the previous year under consideration and disallowed the claim in regard to wealth-tax for the earlier assessment years as also the income-tax liabilities. It is against this order that the petitioner filed a revision petition to the Commissioner praying that the wealth-tax liabilities of the earlier years as also the income-tax liabilities were to be deducted in computing the net wealth of the assessee for the relevant assessment year.

(3.) THE contention for the petitioner is that the rejection of the claim is based upon a misconception of the provisions of law. It is contended that the income-tax and wealth-tax liabilities were debts within the meaning of the expression in s. 2(m) and all such debts existing or outstanding due as at the relevant valuation date were to be deducted from the gross assets in order to arrive at the net wealth of the assessee and that such a liability or debt would not be deducted by virtue of sub-cl.(iii)(b) only if such liability was outstanding for a period of more than 12 months on the valuation date. It is urged for the petitioner that the exception made in sub-cls. (i), (ii) and (iii) were not at all attracted to the instant case.