COMMISSIONER OF WEALTH TAX Vs. RAMA SHANKER GUPTA

JUDGEMENT

(1.) AT the instance of the Commissioner of Wealth-tax, the following questions have been referred for our opinion :

(2.) THE facts lie within a narrow compass and may be briefly stated thus. THE assessee before us is a co-owner of the property situate at 24/73 Birhana Road, Kanpur. Besides, he is a partner in two firms which, in their turn, also owned immovable properties comprising business premises situate in an urban area. In respect of the assessment year 1976-7, the Wealth-tax Officer made an assessment of the net wealth of the assessee on March 30, 1981, at Rs. 19,03,120. This included the assessees one-third share in the firm, Nagarmal & Co., taken at Rs. 26,812.

(3.) THE assessee challenged the orders of the Commissioner of Wealth-tax by way of appeals before the Income-tax Appellate Tribunal. THE Tribunal allowed both the appeals, setting aside the order passed by the Commissioner of Wealth-tax. THE Tribunal came to the conclusion that on a true and proper interpretation of the rules mentioned in Part I of the Schedule to the Wealth-tax Act, properties belonging to New Cawnpore Flour Mills and Nagarmal & Co. were liable to be excluded from the charge of additional tax in computing the net wealth of the assessee. In regard to the first error pointed out in the notice issued by the Commissioner under section 25(2) of the Act, the Tribunal observed that in the absence of any report of the Valuation Officer, it could not be legitimately inferred that there was any appreciation in the value of the property belonging to the firm, Nagarmal & Co. THEre was no other material on record to sustain that conclusion and, consequently, it was not proper for the Commissioner to set aside the order passed by the Wealth-tax Officer and to adopt a new valuation. It is from this decision of the Tribunal that the reference has been made to us at the instance of the Commissioner.