COMMISSIONER OF WEALTH TAX Vs. LALITCHANDRA M PATEL

JUDGEMENT

(1.) In this reference at the instance of the revenue, the following questions are referred for our opinion in respect of assessment years 1970-71 to 1973-74:-

(2.) The respondent - assessee was a partner in the firm called L.M. Patel and Co. having 40% share. While assessing the interest of the assessee as partner in the said firm, the question of value of property of the firm consisting of 5 storeyed commercial cum office building on land admeasuring 11043 sq.ft. came up for consideration. The Wealth-tax Officer adopted the value of the said property as determined by the assessee's valuer. Subsequently on a reference made to the departmental valuer, the property was valued at Rs.12,44,000.00 for the years under consideration. The Commissioner of Wealth-tax (CWT) after examining the wealth-tax record of the assessee for the years under consideration found that the assessment framed by the Wealth-tax Officer were prejudicial to the interest of the revenue, as the value determined by the District Valuation Officer (i.e. departmental valuer) was higher than the value assessed by the assessee's valuer. Hence, there was a gross understatement. The Commissioner under section 25(2) of the Wealth-tax Act, 1997 (hereinafter referred to as "the Act") set aside the assessments made by the Wealth-tax Officer directing him to recompute the correct net wealth and tax accordingly. The assessee succeeded in appeal before the Income-tax Appellate Tribunal. Hence, this reference at the instance of the revenue.

(3.) We have heard Mr Tanvish Bhatt, learned Standing Counsel for the revenue. Though served, none appears for the respondent - assessee.