COMMISSIONER OF GIFT TAX Vs. PADMA SANTHANAM

JUDGEMENT

(1.) THE assessee is a holder of shares in Sundaram Industries Ltd., Madras, and she made a gift of 4,000 shares to individual trusts. In the original assessment made for the asst. yr. 1974-75, the value of the shares was determined at Rs. 121 per share. THE GTO subsequently, on the basis of the Board's Circular dt. 29th October, 1974, came to the conclusion that r. 10(2) of the GT Rules 1958, does not permit 15 per cent deduction which was given in the original assessment and, therefore, the assessment was liable to be reopened. After giving notice to the assessee, he reopened the assessment and determined the value of the shares at Rs. 142.30 per share.

(2.) THE assessee preferred an appeal before the CIT(A) and the CIT(A) came to the conclusion that there are two methods of valuation and since the GTO adopted one method of valuation during the course of original assessment, it is not open to him to adopt another method of valuation in the reassessment proceedings and, therefore the reassessment done by the GTO was liable to be cancelled. THE CIT(A) held that there was no jurisdiction to reopen the completed assessment. 3. THE Revenue preferred an appeal before the Tribunal. THE Tribunal, following its earlier order in GTO vs. Miss Malini Srinivasan [GTA No. 55 (Mad) of 1979, GTA No. 57 (Mad) 57 of 1979 and 58 (Mad) of 1979, dt. 26th August 1980], came to the conclusion that the reopening of assessment was invalid. It is this order which is the subject-matter of the present tax case reference. THE Tribunal has stated a case and referred the following question of law for our opinion in pursuance of the direction of this Court under s. 26(3) of the GT Act, 1958 :