COMMISSIONER OF WEALTH TAX Vs. SHAH V M

JUDGEMENT

(1.) THIS reference concerns the uncollected fees of a practising chartered accountant and the issue to be considered is whether these fees form an asset upon which wealth -tax may be collected. The questions raised at the instance of the Revenue read thus :

(2.) THE assessment years with which we are concerned are the assessment years 1964 -65 to 1969 -70. The assessee was during the previous years relevant to these assessment years, a partner of the firm of M/s. C. M. Shah and Co., Chartered Accountants, and had a 45% share therein. The firm maintained its accounts on cash basis and upon that basis, drew up its balance -sheets and profit and loss accounts for the years under reference. In his wealth -tax returns for these years, the assessee valued his 45% share in the firm on the basis of the balance -sheets. The Wealth -tax Officer required the assessee to inform him of the approximate amount of the outstanding bills of the firm at the end of each of the two accounting years. The Wealth -tax Officer included 45% of the figures estimated by the assessee in this behalf in the assessee's net wealth. He did not make any other adjustments in the value of the assessee's share in the firm.

(3.) THE Revenue carried the matter to the Income -tax Appellate ribunal. The Tribunal, following the judgment of the Orissa High Court in CWT v. Vysyaraju Badreenarayanamoorthy Raju : [1971]79ITR330(Orissa) , upheld the order of the Appellate Assistant Commissioner and dismissed the appeals.