COMMISSIONER OF GIFT TAX Vs. RAMESH K

JUDGEMENT

(1.) THE questions of law which we are asked to answer in this gift-tax case relates to the valuation of unquoted shares in M/s. T. V. Sundaram Iyengar and Sons and M/s. Sundaram Industries Ltd. THE valuation of the shares was made by the GTO on the basis of the break-up value method. THE gift in this case was by the assessee-holder on March 28, 1972. THE GTO took the balance-sheet of the two companies as at March 31, 1972, and applied the break-up value method on the net worth of the companies as on that date. On appeal, the Tribunal held that since the gift took place before the balance-sheet as at March 31, 1972, the break-up value method must be applied to the last balance-sheet before the dated of the gift, namely, the balance-sheet as at March 31, 1971.

(2.) THE correctness of the method which found favour with the Tribunal is the subject-matter of the present reference. THE question of law which has been referred to us in this case is at the instance of the Department and it is as follows :