1993 (6) TMI 104

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..... und is also taken objecting to the decision of the AAC that as per r. 2D(a) of the WT Rules, 1957, the share of a partner in advance tax paid by the firm is not liable to be included in the net wealth of the partner though advance tax was not reflected in the balance sheet. 2. The original assessments made were reopened by the WTO u/s 17 because according to him to share of the assessee in depreciation reserve account appearing in the balance sheet of the firm for the respective years was not included in the original assessments. The WTO added the share in the depreciation reserve account coming to each partner according to the profit and loss ratio subsisting in the relevant previous year and then completed the assessments u/s 16(3) r/w .....

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..... ssets on which depreciation is admissible are made so as to take the value as per the written down value of the assets shown in the balance sheet of the firm. Since this adjustment is made in respect of the assets as contemplated under the Rule, the value appearing in the balance sheet on the asset side in respect of all the assets and also the amount appearing in the balance sheet on the liability side by way of depreciation reserve account which is nothing but the accumulated depreciation over a number of years, should be ignored. Regarding share in the advance tax made by the firm, he submitted that r. 2D(a) of the Rules excludes advance tax even if it is shown as asset in the balance sheet. If it is not shown as an asset in the balance .....

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..... ance sheet of the firm, the balances being shown on the asset side of the balance sheet from year to year would have reduced by the amount of provision in respect of the depreciation made from year to year, in which case there would not appear any account on the liability side of the balance sheet. Therefore, whether to show a net amount by way of outstanding balance in each particular asset or whether to show a gross debit balance in each particular asset and also show simultaneously the credit balance representing the depreciation related to the asset account would not make any difference for the consideration. The result is same. In the first instance it showed only the net balance while in the second instance it showed a gross on the as .....

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