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TMI Blog1984 (2) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... , the decrees obtained by the assessee against Shri A. H. Lal and Shri D. D. Tulsi for Rs. 1,11,747 and Rs. 51,525 respectively, have been valued under the Wealth-tax Act, 1957, by correctly applying the provisions of section 7 of the Act for the purpose of including their values in the net wealth of the assessee ? " Question No 3: " Whether, the sum of Rs. 32,266, the amount of agricultural income-tax due from the assessee, falls for deduction in the hands of the assessee in arriving at his total wealth for the years 1957-58, 1958-59, 1959-60 and 1960-61 ?" Question No. 4: " Whether the sums of Rs. 5,97,909 due from Tikait Girja Prasad Singh, Rs. 40,001 due from Sri Gangeshwar Prasad Singh, Rs. 64,000 due from Mahanth Mahabir Das, Rs. 39,7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f these assets and that is a factor which should be taken into consideration. The point has been discussed by this court in the case of CWT v. Maharaja Kumar Kamal Singh (Civil Appeals No. 1238 to 1240 (NT) of 1973) [1984] 146 ITR 202 (SC)). The question is, therefore, answered as the answer given in the said appeals and the Tribunal will estimate the value by taking into consideration the possibility for deduction on account of the liability of the assessee on account of agricultural income-tax if it bad not been already deducted in accordance with the provisions of the Act and determine the net value of the assets of the assessee, accordingly. These questions are for the wealth-tax assessments of the assessee for the assessment years 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 for the year 1957-58, due from Sri A. K. Hazra and Sri N. Sahay, respectively, on the basis of usufructuary mortgage in favour of the assessee as his assets. On the last point the assessee has obtained relief from the Appellate Tribunal for the year 1957-58 and for that reason these two sums were excluded from the net wealth of the assessee for the subsequent assessment years and that point had given rise to the reference in Tax Cases Nos. 23 to 27 of 1966. On the other questions raised by the assessee, reference in Tax Cases Nos. 64 to 68 of 1967 had arisen. Now, the facts material for question No. 2 are as follows: The assessee had obtained civil court decrees for Rs. 1,11,747 and Rs. 51,525 against Sri A. H. Lal and Sri D. D. Tulsi. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... followed. On the other hand, it was contended on behalf of the Revenue that decrees had been correctly valued u/s. 7(2)(a) of the Act. The High Court held, and in our opinion rightly, that the two decrees had not been valued u/s. 7(2) of the Act at all and had been valued u/s.7(1) of the Act. We are in agreement with the High Court that merely because the assessee had shown the full decretal amounts in his books as still due, would not ipso facto lead to the conclusion that they would be valued at those sums without taking into consideration the hazards for realisation of the decrees. These decrees had not been executed and in the process of execution, there may be hazards and the WTO must estimate the price of the decree by anticipating wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d have paid for it on the relevant valuation date, in open market considering that this claim decree can only be satisfied, wholly or partly from the compensation which the debtor would receive under the Bihar Land Reforms Act, 1950. The claim decree was an asset, the High Court held, but it was wrongly valued by the authorities and directed to be valued by estimating what it would fetch in the open market on the valuation date taking into consideration all the hazards. On the same principle, the other decrees mentioned in the questions have been disposed of by the High Court. We are of the opinion that in view of the principles discussed by this court in the case of CWT v. Maharaja Kumar Kamal Singh [1984] 146 ITR 202 (SC), the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value independently. About propositions Nos. (1) and (2) above, there cannot be any dispute. But as regards proposition No. (3) as this court has discussed in CWT v. Maharaja Kumar Kamal Singh [1984] 146 ITR 202 (SC), if there is an asset which is subject to certain hazards including the liability of certain debt to be deducted from the said asset, then that factor would be a relevant factor diminishing the market value of the asset in open market and has to be estimated taking into consideration that factor. Regarding proposition No. (4), it may be stated that while it is a question of fact but if the Tribunal has arrived at the conclusion by taking wrong principles into consideration, then such a finding would not bind the high Court. R ..... X X X X Extracts X X X X X X X X Extracts X X X X
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