9911796707
TMI Blog1996 (1) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... computing their own individual net wealth ?" The occasion for such a reference was the conflicting views taken on this point by the Karnataka and the Patna High Courts. The relevant assessment year is 1975-76 corresponding to the valuation date March 31, 1975. The assessee-Hindu undivided family had an interest in the firm called Properties Development Syndicate through its karta who is the partner of the firm. The assessee returned the balance in the capital account with the firm at Rs. 1,25,000 and claimed deduction of Rs. 75,000 being share in fixed deposit and agricultural lands held by the firm under sections 5(1)(xxvi) and 5(1)(iv)(a), respectively of the Wealth-tax Act. The Wealth-tax Officer rejected the claim for exemption on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... instance of the Revenue, the above quoted question of law has been referred directly for decision by this court under section 27(3A) of the Act. Having heard learned counsel, we are of the opinion that the view taken by the Tribunal is correct. In the statement of case, the Tribunal has stated the correct position as under : "The third case would be one in which the claim for exemption is to be considered only in the hands of the assessee both in respect of the assessee's own assets as well as the assets of the firm in which he has an interest. The Appellate Tribunal found that rule 2 of the Wealth-tax Rules, was designed to achieve this result since the Act itself required that the assets of the firm should be apportioned among the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had also been held by the Madras High Court in CWT v. Vasantha [1973] 87 ITR 17 that the word 'net wealth' in rule 2 has to be understood according to the definition given in section 2(m) of the Act. The definition stated that 'net wealth' means the amount by which the aggregate value computed in accordance with the provisions of the Act of all the assets, belonging to the assessee is in excess of the aggregate value of the debt owed by the assessee on the valuation date. Thus, the expression 'net wealth' had to include assets exempt under section 5 since they were otherwise taxable unlike certain things which are excluded from the definition of 'assets' under section 2(m) of the Act. This led to the result that the net wealth of the firm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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