COMMISSIONER OF WEALTH TAX Vs. PADAMPAT SINGHANIA

JUDGEMENT

(1.) THESE Wealth-tax References relate to the assessment years 1968-69 and 1969-70. They arise under the W.T. Act. The question of law referred for our opinion is :

(2.) THE assessee owns shares in certain companies. THEse were unquoted shares. THE assessee declared their value at a figure which was worked out by calculating the break-up value as well as the average value and taking their mean to be the proper value. THE assessee further contended that this was the method adopted by it for valuing these very shares in the assessment years 1961-62 to 1966-67 and the same can be applied for the years in question. THE WTO differed. He relied on Rule 1D of the W.T. Rules and calculated the value of the shares according to the method prescribed in that rule.

(3.) SO long the rule was not framed it was open to the WTO to apply any method to determine the market value. After the framing of the rules the method has been prescribed by Rule 1D. Rule 1D, which is in force, should be applied in determining the market value of unquoted shares. When any higher authority, namely, the AAC or the Tribunal, deal with the market value of unquoted shares, Rule 1D being valid law, was equally available to them. They could not ignore it. In the present case, we have no compelling circumstance like in the Supreme Court decision in Deep Chand's case, AIR 1959 SC 648, that one interpretation may lead to the constitutional invalidity of the provision of a statute.