COMMISSIONER OF WEALTH TAX Vs. KISHORILAL AGRAWAL

JUDGEMENT

(1.) IN this reference made under Section 27(1) of the Wealth-tax Act, 1957 (in short, "the Act" hereinafter), relating to the assessment year 1975-76, the following question of law has been referred by the Tribunal for the opinion of this court :

(2.) THE assessee is a partner in a firm, Messrs. Agiwal and Company. THE said firm acts as a civil contractor engaged in construction of roads, buildings and drains. THE assessee claimed exemption under Section 5(1)(xxxii) of the Act of the value of interest in the assets of the firm on the ground that the entire assets of the firm formed part of an industrial undertaking belonging to the firm. THE value of the assessee's interest in the assets of the firm was Rs. 1,40,000. THE Wealth-tax Officer being not satisfied with the claim, refused to grant exemption, THE assessee's appeal to the Appellate Assistant Commissioner failed. But on second appeal, the Tribunal accepted the claim by relying on a decision of the Delhi High Court in the case of National Projects Construction Corporation Limited v. CWT [1969] 74 ITR 465.

(3.) IN the case of State of Madras v. Cannon Dunkerley and Co. (Madras) Ltd., AIR 1958 SC 560, para 33, at page 573, it has been held that :