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2013 (1) TMI 608 - SC - Wealth-taxGift tax on the value of the bonus shares - fundamental question before the High Court in [2002 (5) TMI 42 - PUNJAB AND HARYANA HIGH COURT] that whether there was in fact a gift of 14,000 bonus shares made by the assess to the transferee? - reopening of assessment - Held that:- A perusal of the impugned judgment and order facially indicates that there has been no consideration of the provisions of Section 4(1)(c) of the Act. From the rather elaborate narration of facts, it is quite clear that the assessee had made a valid revocable gift of 6000 equity shares in the company on 20th February 1982 to the transferee. This is a finding of fact conclusively determined by the High Court in the assessee’s own case. The only event that took place in the previous year relevant to the AY 1989-90 was the revocation of the gift by the assessee on 15th June 1988. Whether this event enough for the Gift Tax Officer, in 1996, to re-open the assessment for the year 1989-90, while keeping in mind the fact that bonus shares were allotted to the transferee on 29th September 1982 and 31st May 1986 is possible, on an interpretation of Section 4(1)(c) to answer this question either way, but unfortunately the High Court did not even notice this provision of the Act. Thus this case cannot be decided finally as the view of the High Court on the interpretation of Section 4(1)(c) is missing. Nor the view of the High Court on the applicability or otherwise of the principle laid down in McDowell & Co [1985 (4) TMI 64 - SUPREME COURT]. As far as the applicability of Escorts Farms is concerned [1996 (9) TMI 4 - SUPREME COURT] the question that arose for consideration in that case was the determination of the cost of acquisition of the original shares when bonus shares are subsequently issued. That is the second part of Section 4(1)(c) and that question would arise (if at all) only after a finding is given by the High Court on the first part of Section 4(1)(c) - remand the matter for de novo consideration by the High Court keeping in mind the provisions of Section 4(1)(c) of the Act as well as the orders passed in the case of the assessee for the Assessment Year 1982-83.
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