COMMISSIONER OF WEALTH TAX Vs. KANTILAL MANILAL

JUDGEMENT

(1.) THESE three references arise out of assessments to wealth tax made on the same assessee for the asst. yrs. 1960 61, 1961 62 and 1962 63. They raise identical questions of law and it would, therefore, be convenient to dispose of them by a common judgment.

(2.) THE first question of law which has been referred for our opinion by the Tribunal pursuant to the direction given by this Court is as follows :

(3.) THE assessee was assessed as an HUF and in the course of its assessment to wealth tax for the asst. yrs. 1960 61, 1961 62 and 1962 63, a question arose whether one third share of Dinesh in the coparcenary property which was inherited by Usha and Pushpavati under S. 6 of the Hindu Succession Act, 1956, was liable to be excluded in determining the net wealth of the assessee. This question was decided by the Tribunal in favour of the assessee and the Tribunal held that on death of Dinesh, his one third share in the joint family properties devolved on Usha and Pushpavati and thus ceased to belong to the assessee and the assessee was, thereafter, entitled only to the remaining two thirds share in those properties. The Tribunal observed that jewellery belonging to the HUF at the date of death of Dinesh was of the value of Rs. 29,270 and since Pushpavati, by virtue of inheritance from Dinesh and settlement with Usha, was entitled to an undivided one third share in that jewellery and only the remaining undivided two thirds share belonged to the assessee, the value of the jewellery owned by the assessee amounted to less than Rs. 25,000 and it was accordingly exempt from wealth tax under S. 5(1)(xiv). The Revenue did not challenge the view of the Tribunal that one third share in the properties belonging to the HUF at the date of death of Dinesh was inherited by Usha and Pushpavati and, consequently, it ceased to be the property of the HUF and was liable to be excluded in comparing the net wealth of the assessee. But, so far as the decision of the Tribunal according exemption to the jewellery was concerned, the Revenue was dissatisfied with it and it has, therefore, brought up that decision before us for our scrutiny by obtaining the present reference. The question is whether the view taken by the Tribunal that one third share in the jewellery belonged to Pushpavati and Usha or after the settlement to Pushpavati alone and only two thirds share belonged to the assessee and since that two thirds share was of the value of less than Rs. 25,000, it was exempt from tax under S. 5(1)(xiv), can be said to be incorrect.