COMMISSIONER OF WEALTH TAX Vs. LEENA MUKHERJEE

JUDGEMENT

(1.) The relevant facts in this reference under Section 27(1)of the Wealth-tax Act, 1957, as appearing from the statement of the case and the annexures thereto may be shortly stated as follows: The assessee in the instant case held certain shares of Martin Burn Co. Ltd. during the assessment year 1965-66, On the 26th March, 1965, Martin Burn Co. Ltd., at its annual general meeting, declared dividends. The relevant resolution in respect of such declaration was as follows :

(2.) It is not disputed that the net dividend payable to the assessee in terms of the said resolution amounted to Rs. 60,144. In her return for wealth-tax for the said assessment year 1965-66, the assessee did not include the said amount of Rs. 60,144. It was contended by the assessee that she did not receive the said amount prior to the valuation date for the said assessment year, namely, 31st March, 1965. It was further contended by the assessee that the dividend warrant issued in the instant case was dated the 1st April, 1965, and the amount thereof could not, in any event, be received prior to the said date.

(3.) At the assessment, the Wealth-tax Officer included this amount in computing the net wealth of the assessee. The officer held that the declaration of dividend on the 26th March, 1965, resulted in an indisputable right in favour of the assessee as on the 26th March, 1965, prior to the date of valuation. He also held that as the dividend warrant in the instant case was issued within six days of the declaration of dividend, the market value of such right which accrued to the assessee as a shareholder should be the same as the declared amount in the warrant.