TMI Blog1992 (3) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... ether the preference shares should be valued in accordance with rule 1C(2) ? [in ITA No. 132 (Cal.)/90] (iv) Whether interest under sections 139(8)/215 and 220(2) of the Income-tax Act can be allowed as a deduction in computing the net wealth ? and (v) Whether the interest of the assessee in the partnership firm be revalued at the time of reassessment proceedings ? As the issues are common in all the appeals the same are being heard and disposed of by this common order for the sake of convenience. 2. At the time of hearing the assessee's counsel has not pressed for any decision on the first issue, namely, about the validity of reassessment proceedings. The same is, therefore, not being considered and decided. 3. Regarding issue No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... presentative submits further that if the claims which were made in the original assessment and rejected and when the assessee had accepted the same as final without preferring any appeal or revision under the provisions of the Wealth-tax Act then he is prohibited and precluded from making fresh claim for such deductions and allowances in the reassessment proceedings. The learned departmental representative has relied on the judgment of Kerala High Court in CWT v. C. Ravindran [1977] 107 ITR 547 and a decision of the Bombay High Court in the case of CWT v. Ballarur Industries Ltd. [1979] 118 ITR 711. According to the learned departmental representative, therefore, the CWT(A) did not go wrong in this regard. 4. We have carefully considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served in the said judgment at page 239 that if a claim for deduction or claim for non-taxability of a receipt was put forward in the original assessment proceedings and was considered and rejected by the tax authorities and that finding had become final then it is not, open to an assessee to put forward those claims once again during the course of reassessment proceedings. The Rajasthan High Court in the case of (1) Shri Rangnath Bangur while dealing with similar issue has observed that-- " So far as the matters raised and decided in the assessment proceedings or in the appeals against the original assessment order are concerned, they should be considered to have been finally decided between the parties and cannot be reagitated merely be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned cases it is clear that once an assessment is reopened the assessee has a right to make claim for deductions and allowances which were not made by him at the time of original assessment proceedings and that the entire assessment is open and a fresh assessment has to be made. But at the same time it is also settled position by now that an assessee is estopped from making claims for any deduction or allowance which he had claimed in the original assessment proceedings and which have become final either by his own conduct by not preferring any appeal against such disallowance or having preferred appeals before the appellate authorities the same having been rejected and having become final. Therefore, in our opinion, the CWT(A) has rig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e not deductible to arrive at the assessable net wealth. 8. In order to resolve this controversy we have to decide whether the interest payable under sections 139, 215 and 220(2) are " debts owed " on the valuation dates. The Hon'ble Supreme Court in the celebrated case of Kesoram Industries Cotton Mills Ltd. v. CWT [1966] 59 ITR 767 has held at page 780 that the word " owed " means to be under an obligation to pay. It does not really add to the meaning of the word " debt ". The meaning of the words " debt owed " could be defined as a liability to pay in praesenti or in futuro and ascertainable sum of money. Thus, according to the Supreme Court the connotation of word " debt " is much larger to comprehend all liabilities. The emerging p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eturn in time. In our view, therefore, the interest which is payable by an assessee under section 139(8) is " debt owed " and deductible in computing the net wealth. We wish to make it clear that the interest under section 139(8) for the assessment year 1974-75 will not be deductible for the wealth assessment year 1974-75 because the liability to pay interest did not exist on the valuation date relevant for assessment year 1974-75 but the same will qualify for deduction as debt owed for any assessment year after assessment year 1974-75. Similarly we are of the opinion that interest under section 215 which also fastened as a liability upon the assessee from 1st April following the assessment year is a liability and " debt owed " and, therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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