COMMISSIONER OF WEALTH TAX vs. FAMOUS NOTICE TRUST

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WTR/246/1996HC GujaratGJHC24022176199629 January 1998Author: HONOURABLE MR. JUSTICE R.K.ABICHANDANI,HONOURABLE MR. JUSTICE ANIL R. DAVE2 pages
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What did the High Court hold?

The High Court answered the question referred to it in the affirmative, in favour of the assessee and against the Revenue. The Tribunal was found to be right in directing the Assessing Officer to levy wealth tax on the assessee trust at the normal rate. The reasoning for this decision is not detailed in this judgment, as it explicitly states that the decision is based on the reasons provided in a similar case, Wealth Tax Reference No. 43/93, decided on the same day. The ratio decidendi would be that in similar circumstances, the normal rate of wealth tax is applicable to the assessee trust. The operative direction is that the reference stands disposed of accordingly, 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 concerning the Wealth Tax Act, 1957. The Commissioner of Wealth Tax is the petitioner, and Famous Notice Trust is the respondent assessee. The reference pertains to the assessment year(s) not explicitly stated. The core of the dispute revolves around the rate at which wealth tax should be levied on the assessee trust. The High Court notes that the facts are similar to another case, Wealth Tax Reference No. 43/93, decided on the same day, and therefore, the facts of this specific case were not reproduced in the judgment. The procedural history indicates that the ITAT referred a question of law to the High Court for its opinion.

What were the issues?

1. Whether the appellate Tribunal is right in law and on facts in directing the Assessing Officer to levy the tax on the assessee trust at the normal rate? (Question of law and fact, concerning the rate of wealth tax levy). Assessee's Contention: The judgment does not record any specific contentions made by the assessee. However, the fact that the Tribunal directed the Assessing Officer to levy tax at the normal rate implies that the assessee likely argued for the application of the normal rate of tax. Revenue's Contention: The judgment does not record any specific contentions made by the Revenue. However, the Revenue is the petitioner in the reference, indicating their disagreement with the Tribunal's direction to levy tax at the normal rate. They likely argued against the application of the normal rate, possibly advocating for a higher or different rate of taxation.

Which sections of the Income-tax Act were involved?

Section 27

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

WEALTH TAX REFERENCE No 246 of 1996

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 FAMOUS NOTICE TRUST

Appearance: B.B.NAYAK with MR MANISH R BHATT for Petitioner Respondent served

--------------------------------------------------------------

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 levy the tax on the assessee trust at the normal rate?"

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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