CWT SHILLONG Vs. SHRI TARACHAND AGARWALLA

JUDGEMENT

(1.) In compliance with the direction given by this Court in Civil Rule Nos. 40 (M) and 41 (M) of 1974 relating to the Wealth tax assessment of Tarachand Agarwalla for the assessment years 1972-73, and 1973-74, the Tribunal drew up statement of case for referring the following question as framed by this Court:

(2.) The facts of the case, in brief, are thus. The assessee was a partner in a partnership firm. In computing net wealth of the assessee, the WTO included the value of assessee's interest in the firm of which he was a partner under Rule 2 of the WT Rules, 1957. The firm owned certain immovable properties. However, the value of assessee's interest in the firm was included as movable properties in the assessment of the assessee. On the appeal filed by the assessee, it was claimed that exemption under section 5(1) (iv) should have been allowed in respect of proportionate share of the assessee in the firm's house property. The Appellate Assistant Commissioner accepted the contention and directed the WTO to allow exemption, as provided under section 5(1)(iv) of the WT Act. On appeal, the Appellate Tribunal dismissed the appeal confirming the order of the Appellate Assistant Commissioner.

(3.) The learned counsel for the Revenue has contended that the interest of a partner in a partnership assets comprising of movable as well as the immovable property should be treated as movable property. To support his contention the learned counsel has relied on the decision of the Supreme Court in Addanki Vs. Bhaskara, AIR 1966 SC 1300 and another decision of the Madras High Court in Purusothamdas v.CWT, (1976) 104 ITR 608.