TMI Blog1978 (9) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... the W.T. Rules. He computed the value of the unquoted shares accordingly. He repelled the further submission of the assessee that while computing his own wealth on the valuation date the estimated amount of capital gains tax which would be payable by him in the event of the sale of these shares should be deducted. This view was upheld on appeal as well as on further appeal by the Tribunal. At the instance of the assessee, the Tribunal has referred the following questions of law for our opinion : " 1. Whether the Tribunal was right in holding that rule 1-D of the Wealth-tax Rules was binding on the Wealth-tax Officer as well as the appellate authorities while valuing the unquoted equity shares? 2. Whether, on the facts and in the circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eduction of any necessary expenses which the assessee was bound to incur in relation to such a sale. This view was accepted by the Supreme Court in Pandit Lakshmikant Jha v. CWT [1973] 90 ITR 97. It was observed : " There is nothing in the language of section 7(1) of the Act which permits any deduction on account of the expenses of sale which may be borne by the assessee if he were to sell the asset in question in the open market. The value according to section 7(1) has to be the price which the asset would fetch if sold in the open market ...... The vendor may, for example, have to pay for the brokerage commission or may have to incur other expenses for effectuating the sale. It is not, however, the amount which the vendor would receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alone is liable to be taken as the value of the asset in the hands of the assessee. This case is clearly distinguishable, because in the present case, the assessee is the exclusive and sole owner of the unquoted shares. No one else is entitled to share in the sale proceeds in case they are sold. Learned counsel placed reliance on Standard Mills Co. Ltd. v. CWT [1967] 63 ITR 470 (SC), in which it was held that the provision for payment of income-tax in respect of the year of account ending on the valuation date was a " debt owed " within the meaning of s. 2(m) and was deductible in computing the net wealth. The question arose because the assessee had in fact earned income. Since the debt had come into existence it was a debt owed by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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