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Issues Involved:
1. Liability of the applicant to wealth-tax for the assessment year 1957-58 on a sum of Rs. 20,50,000. 2. Justification of the Appellate Tribunal in holding that there were duplicate assessments in respect of the same wealth. 3. Exclusion of the value of the assessee's interest in the income from shares in Messrs. A. & F. Harvey Ltd. in computing the net wealth of Mrs. Harvey under section 6(i) of the Wealth-tax Act. Issue-wise Detailed Analysis: Issue 1: Liability of the applicant to wealth-tax for the assessment year 1957-58 on a sum of Rs. 20,50,000 The court examined whether Mr. Harvey's executors could be assessed for the wealth-tax for the assessment year 1957-58. The Tribunal had held that the executors could be assessed only for the assessment year 1957-58, relying on the Bombay High Court's decision in Jamnadas v. Commissioner of Wealth-tax. The court analyzed the statutory provisions, particularly sections 3, 2(m), 2(q), and 19 of the Wealth-tax Act, and concluded that wealth-tax is chargeable on the aggregate value of all assets of a person as on the valuation date. Since Mr. Harvey died on March 28, 1957, and was not alive on March 31, 1957 (the valuation date), his assets could not be taxed in the hands of the executors for the assessment year 1957-58. The court also distinguished the provisions of the Wealth-tax Act from the Income-tax Act, noting that wealth-tax is assessed based on the wealth as of a specific date, unlike income-tax, which is based on income accrued over a period. Therefore, the court answered the first question in the negative and in favor of the assessee. Issue 2: Justification of the Appellate Tribunal in holding that there were duplicate assessments in respect of the same wealth The Wealth-tax Officer had made direct assessments on Mrs. Harvey and also assessed Messrs. A. & F. Harvey Ltd. as her agents. The Tribunal held that the interest of Mrs. Harvey in the income from 45,000 shares in Messrs. A. & F. Harvey Ltd. was located in England and, under section 6(i) of the Act, was liable to be excluded from wealth-tax. Consequently, the direct assessments on Mrs. Harvey and the assessments on Messrs. A. & F. Harvey Ltd. as her agents were erroneous in law. The court upheld the Tribunal's decision, agreeing that the assessments were indeed duplicate and otiose. Therefore, the court answered the second question in the affirmative and against the department. Issue 3: Exclusion of the value of the assessee's interest in the income from shares in Messrs. A. & F. Harvey Ltd. in computing the net wealth of Mrs. Harvey under section 6(i) of the Wealth-tax Act The Tribunal found that Mrs. Harvey's interest was merely a right to receive income from the executors in England and not a proprietary interest in the shares themselves. Since the right to receive income was enforceable only in England, it was considered an asset located outside India and fell within the scope of section 6(i) of the Act. The court agreed with this interpretation, noting that Mrs. Harvey had no right to proceed against the Indian company for dividends and could only claim income from the executors in England. Thus, the value of her interest in the income from the shares was rightly excluded from wealth-tax computation. The court answered the third question in the affirmative and against the department. Conclusion: The court concluded that: 1. The executors could not be assessed for wealth-tax for the assessment year 1957-58. 2. The Tribunal was justified in holding that the assessments were duplicate and otiose. 3. The value of Mrs. Harvey's interest in the income from shares was rightly excluded from wealth-tax computation under section 6(i) of the Act. The assessee was entitled to costs, with counsel's fee fixed at Rs. 500.
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