COMMISSIONER OF WEALTH TAX vs. RIKHAV ASSOCIATES

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WTR/115/1995HC GujaratGJHC24022797199529 January 1998Author: HONOURABLE MR. JUSTICE R.K.ABICHANDANI,HONOURABLE MR. JUSTICE ANIL R. DAVE2 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the Appellate Tribunal was right in law and on facts in directing the Assessing Officer to charge wealth tax at the normal rate instead of the maximum marginal rate of 3% charged by the WTO. The reasoning provided is that the facts and the question involved in this case are similar to those in Wealth Tax Reference No. 43/93, which was decided by the same bench on the same day. For the reasons given in the judgment of Wealth Tax Reference No. 43/93, the question referred to the High Court was answered in the affirmative. The ratio decidendi is that the ITAT's decision on the applicable rate of wealth tax, based on the facts similar to a prior case, was upheld. The operative direction is that the reference stands disposed of in favour of the assessee and against the Revenue, with no order as to costs. No issue was expressly left undecided.

What were the facts?

This case involves a reference made by the Income Tax Appellate Tribunal (ITAT), Ahmedabad, to the High Court of Gujarat under Section 27(1) of the Wealth Tax Act, 1957. The reference concerns the assessment year(s) not explicitly stated but implied to be similar to Wealth Tax Reference No. 43/93. The order under challenge is the direction by the ITAT to the Assessing Officer to charge wealth tax at the normal rate, as opposed to the maximum marginal rate of 3% charged by the Wealth Tax Officer (WTO). The procedural history is that the ITAT referred the question to the High Court for its opinion. The amount in dispute is not explicitly stated.

What were the issues?

The Tribunal had to decide the following question of law: 1. Whether the Appellate Tribunal is right in law and on facts in directing the Assessing Officer to charge wealth tax at the normal rate as against the maximum marginal rate of 3% charged by the WTO? The assessee's contentions are not recorded in the judgment. The revenue's contention is implied by their filing of the reference, challenging the ITAT's direction to charge tax at the normal rate instead of the maximum marginal rate of 3% applied by the WTO. The judgment does not name any specific authorities, circulars, or precedents relied upon by either side.

Which sections of the Income-tax Act were involved?

Section 27(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

WEALTH TAX REFERENCE No 115 of 1995

For Approval and Signature:

Hon'ble MR.JUSTICE R.K.ABICHANDANI and MR.JUSTICE A.R.DAVE ============================================================ 1. Whether Reporters of Local Papers may be allowed to see the judgements?

2.

To be referred to the Reporter or not?

3.

Whether Their Lordships wish to see the fair copy of the judgement?

4.

Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder?

5.

Whether it is to be circulated to the Civil Judge?

-------------------------------------------------------------- COMMISSIONER OF WEALTH TAX Versus RIKHAV ASSOCIATES

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Appearance: MR P.G. DESAI with MR MANISH R BHATT for Petitioner Respondent served

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CORAM : MR.JUSTICE R.K.ABICHANDANI and MR.JUSTICE A.R.DAVE Date of decision: 29/01/98

ORAL JUDGEMENT (Per R.K.Abichandani,J.)

The Income Tax Appellate Tribunal, Ahmedabad has referred for the opinion of this Court the following

question under Section 27(1) of the Wealth Tax Act, 1957. "Whether the Appellate Tribunal is right in law and on facts in directing the Assessing Officer to charge rate at normal rate as against the maximum marginal rate of 3% charged by the WTO?"

A similar question has been answered by us today in Wealth Tax Reference No. 43/93. Since the facts are similar and the question involved almost identical, we do not find it necessary to reproduce the facts of this case. For the reasons given by us in our judgement and order delivered in Wealth Tax Reference No. 43/93 today, we answer the question referred to us in the affirmative in favour of the assessee and against the Revenue. The reference stands disposed of accordingly with no order as to costs.

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*/Mohandas

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