BISHANLAL AHUJA Vs. COMMISSIONER OF WEALTH TAX

JUDGEMENT

(1.) These two reference cases arise under the WT Act, 1957 (for short "the Act"). They relate to the same assessee. RC No. 49/87 is in respect of asst. yrs. 1972-73 to 1977-78 whereas RC No. 50/87 pertains to asst. yrs. 1978-79 and 1979-80. At the instance of the assessee, the following question is referred to us for our opinion, under s. 27(1) of the Act, in these cases.

(2.) The facts giving rise to these reference cases may briefly be referred to here. The assessee is a partner in the firm viz., M/s 3 Aces, Abids Road, Hyderabad. The said firm had originally two partners, the petitioner and his brother one Shri Jagatram Ahuja. The assessee purchased the share and interest of his brother w.e.f. 1/04/1971 and thus became the absolute owner of the said property. On 4th Jan., 1972 he converted the said property into partnership property by constituting a partnership firm of himself and his four daughters. That property is known as 'Mohsin-Ul-Mulk Kothi'. It comprises of main building having door No. 4-1-970 adjacent building and tin shed bearing Door No. 4-1-969/7 together with appurtenant land admeasuring 9877 sq. yards, herein-after referred to as "the building in question". For the said assessment years, the net wealth of the assessee was determined treating the entire building in question as the assessee's property under r. 2 of the WT Rules, 1957 (for short 'the Rules'). The assessee appealed to the CIT against the order of the WTO. The appeal was dismissed on the ground that in view of clause 14 of the partnership deed, the assessee was entitled to take over the entire partnership assets including the building in question so it would have to be considered as the property of the assessee. The assessee then filed the second appeal before the Tribunal. The Tribunal dismissed the appeal upholding the order of the appellate authority (CIT). Thus, the abovesaid question came to be referred to this Court.

(3.) Sri Y. Ratnakar, the learned counsel for the assessee submits that the Tribunal erred in confirming the orders of the WTO and the CIT(A) by erroneously interpreting r. 2 of the Rules and, therefore, the question has to be answered against the Revenue. He further submits that the Tribunal did not record finding on relevant questions of fact and, therefore, the Tribunal has to be directed to record finding on all the relevant aspects of the case. On the other hand, the learned standing counsel for the Revenue submits that r. 2 of the Rules has been properly invoked by the authority and the net wealth was correctly determined and, therefore, the order of the Tribunal cannot be found fault with.