COMMISSIONER OF WEALTH TAX Vs. URMILA RUNGTA

JUDGEMENT

(1.) In this reference under Section 27(1) of the Wealth-tax Act, 1957, the Tribunal has referred the following common question for the assessment years 1979-80 to 1982-83 for our opinion :

(2.) Shortly stated, the facts are that the assessee, on the relevant valuation dates, was a partner of a firm, Messrs. Madgul Udyog, engaged in the business of construction and sale of multi-storeyed buildings. The assessee claimed that the investments in the said firm were exempted under Section 5(1)(xxxii) of the Wealth-tax Act on the ground that the firm being engaged in the construction of multi-storeyed buildings is an industrial undertaking within the meaning of the said provision. The firm set up a similar claim under Section 80J of the Income-tax Act but the Income-tax Officer did not accept the firm as an industrial undertaking. Consequently, the claim of exemption under Section 5(1)(xxxii) of the Wealth-tax Act was also denied to the assessee.

(3.) Being aggrieved, the assessee challenged the above order in appeal before the Deputy Commissioner of Income-tax (Appeals) and contended that the Tribunal, in the case of the firm, held the firm to be an industrial undertaking for the purpose of Section 80J of the Income-tax Act, vide its order dated September 4, 1986, in Income-tax Appeals Nos. 720 to 722 and 2037/(Cal) of 1985. The Deputy Commissioner of Income-tax (Appeals), following the said order of the Tribunal, directed that exemption under Section 5(1)(xxxii) of the Wealth-tax Act be allowed to the assessee.