9911796707
TMI Blog1986 (3) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... h in Shree Mahabir Industries (P) Ltd., Periwal Co. (P) Ltd., Taximeters Equipment Ltd. and Periwal Co. (P) Ltd. respectively. The total book value of these shares came to Rs. 4,55,460 for both the years in question. But the break-up value in accordance with rr. 1-D and 1-C came to Rs. 1,86,960 and Rs. 2,55,176 respectively. The assessee initially computed the value of the shares held by them in Bayunandan Rice & Oil Mills (P) Ltd. in accordance with rr. 1-C and 1-D of the WT Rules and in computing the value of the shares held by that company, instead of taking the book value, the break-up value of those shares which was much less, was taken for the purpose of computing the assets of Bayunandan Rice & Oil Mills (P) Ltd. The ITO accepted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... note. Reference was made to the decision of the Hon'ble Supreme Court in Indian and Eastern Newspapers Society vs. CIT (1979) 12 CTR (Bom) 258 : (1979) 119 ITR 996 (SC), according to which it had been held that the WTO could not have proceeded on the basis of audit note and, therefore, the conclusion of the AAC that s. 17(1)(b) was rightly applied by the WTO was not correct. The WTO would have to determine for himself as to what was the effect and consequence of law mentioned in the audit note and whether in consequence of the law which had been brought to his notice by the audit party, he could reasonably believe that the assessee's wealth had escaped assessment. The reason of the audit partly could not add to or colour the significance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asked the WTO to do so and the WTO had consciously done it. In this behalf the following observations of the WTO in the original order of the assessment need be repeated in extenso: ".......and stated that the total wealth declared as per return included value of shares a per assessee's own balance sheet (as cost). It was requested by him that the value of shares held by the assessee may be taken as per r. 1-C & 1-D of the WT Act. Balance sheets of the relevant companies have been filed. Value of the shares held by the assessee has correctly worked out by the A. R. as per rr. 1-C & 1-D. The same is admitted as per statement." A reading thereof would show that the WTO making the assessment earlier had purported to apply his mind and had c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Supreme Court in Indian & Eastern Newspaper Society Ltd., does not appear to be correct in law. 6. Before parting, we may point out that we are only expressing opinion about the correctness of the ground of decision taken by the AAC who has stated that he had decided the appeals in persuance of the earlier direction of the Tribunal and had not considered any other aspects of the matter. It is only because of the earlier directions that we are constrained to reverse the decision of the AAC, otherwise the reopening and the fresh assessment made by the WTO appeared to be fully justified. The earlier interpretation of computing the market value of the shares taken by the WTO was wholly and unmistakable wrong. The value of the shares had to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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