CWT Vs. BENI RAM BANSIDHAR JAIN

JUDGEMENT

(1.) THE Income Tax Appellate Tribunal, Allahabad, has referred the following question of law under section 27(1) of the Wealth Tax Act, 1957, hereinafter, referred to as 'the Act', for opinion to this Court: - 'Whether on the facts and in the circumstances of the case, the Income tax Appellate Tribunal was justified in holding that the assessee HUF should be assessed at the rates applicable to an unspecified HUF and not at the higher rates applicable to a specified HUF ?'

(2.) THE reference relates to the assessment year 1980 -81. The respondent assessee is HUF consisting of three brothers. In the year 1983, there was partition of the HUF, as a result of which, only immovable properties were left with the assessee family and the other assets were divided. In respect of the partitioned assets, the members of the assessee HUF were assessed as smaller HUFs. Before the Wealth -tax Officer, it was claimed that since none of the members of the respondent had wealth above the taxable limit of Rs. 1.5 lakhs in the assessment year 1980 -81, it should be taxed at the rate applicable to an unspecified HUF under clause (1) of Part I of Schedule 1 of the Act. The Wealth -tax Officer did not accept the claim and taxed the HUF at the rate applicable for specified HUF under clause (ii) of Part I of Schedule I of the Act. In the appeal, the Appellate Assistant Commissioner, while allowing the appeal directed the Wealth -tax Officer to tax as unspecified HUF The revenue's appeal before the Tribunal has failed.