COMMISSIONER OF INCOME TAX Vs. V NAMBY

JUDGEMENT

(1.) IN pursuance of the directions of this court under Section 27(5) of the Wealth-tax Act, 1957 (hereinafter to be referred to as "the Act"), the following question of law has been referred to us for our consideration :

(2.) THOUGH Mr. C. V. Rajan, learned counsel for the Revenue, fairly stated that the assessee is no more and time should be granted to take steps to bring the legal representatives on record, yet, in our opinion, this tax case is of the year 1984 and, therefore, it is not necessary for us to wait for the Revenue to take steps and, therefore, we dispose of the tax case reference.

(3.) WE have carefully considered the submissions of learned counsel for the Revenue. There is no dispute on the proposition of law put forth by learned counsel for the Revenue that to claim exemption under the provisions of the WEalth-tax Act, the assessee must satisfy the conditions laid down or prescribed in Section 5(3) the Act. One such condition for claiming exemption is that in the case of assets like units or other assets as contemplated under Section 5(3)(b) the WEalth-tax Act, the assessee must hold the assets on which the assessee claims exemption at least for a period of six months ending with the relevant valuation date. There is no dispute about the fact that the assessee was not holding the units at least for a period of six months ending with the relevant valuation date. But, in our opinion, the question for grant of exemption has to be considered not only with reference to the relevant provisions of the WEalth-tax Act, but also with reference to the provisions of the Unit Trust of India Act. Section 32 of the Unit Trust of India Act provides that notwithstanding anything contained in the WEalth-tax Act, 1957, the Income-tax Act, 1961, the Super Profits tax Act, 1963, the Companies (Profits) Surtax Act, 1964 (VII of 1964), or in any other enactment, for the time being in force relating to income-tax, super-tax, super profits tax, surtax or any other tax on income, the assessee would be entitled to exemption under the provisions of the WEalth-tax Act in the case of the assessee being an individual or a Hindu undivided family, subject to the condition that the value of the assets to be excluded shall not exceed Rs. 25,000. The relevant provision reads as under: