COMMISSIONER OF WEALTH TAX Vs. N KAMALA

JUDGEMENT

(1.) THE question referred to at the instance of the Revenue, for our consideration is, "Whether, on the facts and in the circumstances of the case and having regard to the provisions of r. 1D of the WT Rules, the Tribunal's order holding that the order of the CWT under S. 25(2) of the WT Act was not erroneous or prejudicial to the interests of the Revenue and that therefore the order was liable to be set aside is sustainable in law ?" The assessment years are 1981-82 to 1984-85.

(2.) THE assessee' is an individual. She held certain unquoted equity shares in a firm. In the assessment of her wealth that was originally completed under S. 16(3) of the WT Act for the relevant assessment year, the assessee had evaluated those shares on yield basis, which was accepted by the AO. However, the CIT held that the assessment so made was erroneous and prejudicial to the interest of the Revenue. He also held that the unquoted equity shares should be evaluated as per the provisions of r. 1D of the WT Rules, and directed the AO to enhance the net wealth of the assessee for the assessment year, after evaluating the unquoted equity shares as per r. 1D of the WT Rules. On appeal by the assessee, the Tribunal held that the method of evaluation under r. 1D would be applicable only to companies which are under liquidation or winding up and the method of evaluation to be adopted in the case of going concerns is the yield basis. The Tribunal accordingly set aside the order of the CIT, affirming that of the AO. The present reference has been made, at the instance of the Revenue, aggrieved against that order of the Tribunal.