RAJAN RAMKRISHNA Vs. COMMISSIONER OF WEALTH TAX

JUDGEMENT

(1.) THE petitioner herein challenges the notice issued by the CWT under S. 25(2) of the WT Act seeking to revise the orders passed by the WTO in the case of the petitioner for the asst. yrs. 1974 75 to 1977 78.

(2.) THE petitioner is an individual and is being assessed in the status of an individual under the WT Act. The petitioner had submitted his returns of wealth for the asst. yrs. 1974 75 to 1977 78, in respect of his wealth as on the valuation dates, 31st March, 1974, to 31st March, 1977, respectively, treating 31st March of each year as the relevant valuation date. In each of these four years under consideration, one of the assets shown by the petitioner in his return was the holding of shares in Cloth Traders Pvt. Ltd., a joint stock company which is an investment company. For each of the four years under consideration, the petitioner had valued the shares at Rs. 143.39, Rs. 235.59, Rs. 219.48 and Rs. 245.41, respectively, and the valuation was shown as so much per share. The proceedings for the assessment of wealth for each of these four years were going on simultaneously and at the time of hearing before the WTO the representative of the petitioner submitted that the value per share would be Rs. 143.39, Rs. 164.68, Rs. 169.75 and Rs. 176.70 on each of the above valuation dates, respectively, and for the purposes of this valuation which was submitted at the time of hearing before the WTO, reliance was placed on the decision of the Supreme Court in CWT vs. Mahadeo Jalan (1972) 86 ITR 621 (SC) : TC63R.348. However, the WTO rejected the revised valuation and instead chose to follow the Board's Circular No. 2(WT) of 1967, being the circular dt. 31st Oct., 1967, and he arrived at the valuation of Rs. 210, Rs. 219.56, Rs. 222.83 and Rs. 240.38, respectively, for these valuation dates. Ultimately, on the footing of these valuations, assessment orders were passed under S. 16(3) of the WT Act. In making the wealth tax assessments, as shown by the assessment orders for the respective years, the WTO made assessment in accordance with the circular of 31st Oct., 1967. Thereafter, the assessments were completed on 21st Feb., 1978, for all these years.

(3.) THE main question in this case is whether the circular of the Board dt. 31st Oct., 1967, is superseded by the subsequent decision of the Supreme Court in CWT vs. Mahadeo Jalan (supra). In order to understand the background to this question, it should be noted that under the WT Act, s. 7(1) :