KUSUMBAI JAIN Vs. COMMISSIONER OF WEALTH TAX

JUDGEMENT

(1.) THIS is a wealth-tax reference under Section 27(1) of the Wealth-tax Act, 1957, at the instance of the assessee and the following two questions of law have been referred by the Tribunal for answer of this court, which read as under :

(2.) THE brief facts giving rise to this petition are thus : THE assessee disclosed the value of the property for the assessment years 1970-71 and 1971-72. THEre was no dispute about the ownership of this property in those two assessments. However, the dispute about the value of that property travelled before the Appellate Assistant Commissioner for the assessment years 1970-71 and 1971-72. By his order dated March 25, 1974, the learned Appellate Assistant Commissioner of Wealth-tax, Jabalpur Range, Jabalpur, determined the issue of the valuation of the property only. When the returns were filed by the assessee for the assessment years 1972-73, 1973-74, 1974-75, 1975-76 and 1976-77, the assessee included the value of those properties in her net wealth and represented that the property belonged to her and she was the owner. THE Wealth-tax Officer completed the assessments for the assessment years 1972-73 to 1976-77, by his order dated February 23, 1979. In these assessments at the assessment stage, the assessee did not raise the question of ownership of this property before the Wealth-tax Officer. When the returns for the assessment year 1977-78 was filed by the assessee on March 28, 1980, she excluded the value of those property from her net wealth contending that the same has been gifted to her sons, viz., S/Shri Narendra Kumar and Surendra Kumar, in the year 1956. THE Wealth-tax Officer did not find substance in this claim of the assessee for the assessment year 1977-78 and included the value of the property in her net wealth and completed the assessment on January 1, 1982. THEse assessments were challenged in appeal before the Appellate Assistant Commissioner.

(3.) WE have heard learned counsel for the parties and perused the records. The fact that the assessee has taken inconsistent stand that this property has been gifted by her to her sons and then in the same breath, she had produced the order of the Additional District Judge showing that both the sons acquired the property by adverse possession. Both these contradictory pleas negative the stand of the assessee. Once she has failed to satisfy regarding gift of property to her sons somehow she tried to justify this stand by resorting to plea of adverse possession by producing the order of the Additional District Judge. The order passed by the Additional District Judge, Jabalpur, in appeal is nothing but a collusive decree. Both the sons filed suit against the father and mother though the suit was dismissed by the trial court ; but in appeal, the appellate court reversed the findings and granted a decree of adverse possession. From the facts, it is clear that the decree was collusive one and the assessing authority has rightly not taken it into consideration and we are of the opinion that the view taken by the Tribunal appears to be justified. WE answer this reference in favour of the Revenue and against the assessee.