2006 (1) TMI 537

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..... ssessee on account of funds availed from overdraft account of Punjab Maharashtra Co-op. Bank Ltd., Sion Branch. 3. The brief facts of the case are that, during the years under consider-ation, the assessee had purchased two motor cars, against which it has availed loan from Kotak Mahindra Ltd., and overdraft amount from Punjab Maharashtra Co-op. Bank Ltd. As the corresponding liability, against the motor cars was equal to the amount of value of motor cars, the assessee showed nil taxable wealth on motor car account. There is no dispute with regard to loan availed from Kotak Mahindra Ltd. However, with respect to cheques issued out of overdraft facility availed by the assessee from Punjab Maharashtra Co-op. Bank Ltd., the Assessin .....

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..... thorities. 8. We have considered the rival contentions and carefully gone through the orders of the lower authorities and also deliberated upon the case laws cited by the learned Authorized Representative, in the factual matrix of the instant case. We had also carefully gone through the paper book placed on the file which is certified to be containing documents placed before the Assessing Officer and the learned CWT(A). From the paper book we found that as per overdraft account maintained by the assessee at Punjab and Maharashtra Co-op. Bank Ltd., cheques were issued for purchase of cars which lead to increase the liability of the assessee in the overdraft account. We had also gone through the relevant copy of the ledger account of moto .....

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..... is of no relevance. The undisputed fact is that part of the loan was availed from the Kotak Mahindra Ltd. and the margin money was brought out of the overdraft account which is a liability on the assessee. Such liability is required to be reduced out of the value of the assets for the purposes of computing net wealth under section 3 read with section 2( m ) of the Wealth-tax Act. 9. In view of the above observation we are persuaded to agree with the learned Authorized Representative that lower authorities were not justified in not reducing the overdraft facility availed by the assessee for purchase of motor car, which was having direct nexus between the purchase of car and corresponding increase of overdraft liability. We are therefore .....

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