COMMISSIONER OF INCOME TAX vs. KHUSAL FAMILY TRUST

WTR/114/1995HC GujaratGJHC24022796199529 January 1998Author: HONOURABLE MR. JUSTICE R.K.ABICHANDANI,HONOURABLE MR. JUSTICE ANIL R. DAVE2 pages
AI SummaryAllowed

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 assessee is Khusal Family Trust, and the petitioner is the Commissioner of Income Tax. The assessment year is not explicitly stated, but the reference pertains to an assessment under Section 21(4) of the Wealth Tax Act. The core of the dispute revolves around the levy of wealth tax on the aggregate value of life interest and reversionary interest. The procedural history indicates that the ITAT referred a specific question of law for the High Court's opinion.

What did the High Court hold?

The High Court, in its oral judgment, stated that a similar question had been answered by them on the same day in Wealth Tax Reference No. 47/93. Since the facts and the question involved were almost identical, the Court found it unnecessary to reproduce the facts of the present case. For the reasons provided in their judgment and order delivered in Wealth Tax Reference No. 47/93, the High Court answered the question referred to them in the affirmative, in favour of the assessee and against the Revenue. The reference was disposed of accordingly, with no order as to costs. The principle established is that the levy of wealth tax on the aggregate of life and reversionary interests is contingent upon exceeding the taxable limit, as per the precedent cited.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that in the assessment of the assessee u/s 21(4) of the W.T Act the Wealth Tax was leviable on the aggregate value of life interest and reversionary interest only if such interest exceeded the taxable limit prescribed in the wealth-tax rate Schedule of the relevant year following the judgement in the case of Haresh Anitha Trust 173 ITR 103? The Revenue, as the petitioner, is seeking the opinion of the High Court on this question of law. The judgment does not record specific arguments made by the assessee or the revenue before the High Court. However, the question itself frames the issue as to whether the ITAT's decision on the levy of wealth tax on combined life and reversionary interests, subject to the taxable limit, was legally correct, referencing a prior judgment.

Which sections of the Income-tax Act were involved?

Section 21(4),Section 27(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

WEALTH TAX REFERENCE No 114 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?

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 21(4)

All 167 judgments and leading authorities on Section 21(4) →

Recent GST High Court judgments

Search GST case law →