Wealth tax---

----Reference---Deductions---Bad debt---Finding based on evidence that debt had become bad---No question of law arises---Indian Wealth Tax Act, 1957, S.27:

Held, that the Tribunal had found that the debt of Rs.6,29,367 due to the assessee from the adopted son of the borrower should not be included in the assessable wealth of the assessee. While holding so, the Tribunal had referred to the fact that the borrower had died in the year 1959, and after his death, his adopted son did not incorporate this amount as a loan in the books of account. It was also found by the Tribunal that the claim was barred by limitation. Considering these circumstances, the Tribunal upheld the order of the Commissioner holding that the debt in question had become a bad debt, and as such it could not be included in the assessable wealth of the assessee. On the available materials, the Tribunal could not be said to have committed any error in coming to this conclusion, and no question of law arose. The letter dated January 10, 1987, related only to debts other than the debt in question, and in view of that, the Tribunal had not referred to that letter at all in the course of its order and that did not give rise to any question of law.

C.V. Rajan for Petitioner.

R. Venkataraman for Respondent.

JUDGMENT

V. RATNAM, ACTG. C.J.----In these tax case petitions under section 27(3) of the Wealth Tax Act, 1957, the Revenue seeks a direction to the Tribunal to refer the following two common questions of law, for the assessment years 1973-74 to 1986-87:

"(1) Whether the Appellate Tribunal was right in law in not considering the relevant material on record, namely, the assessee's letter dated January 10, 1987, and referred to in the assessment order dated February 10, 1987, for the assessment year 1973-74 before coming to the conclusion that the debt had become bad?

(2) Whether, on the facts and in the circumstances of - the case, the Appellate Tribunal was right in law in holding that the debt of Rs.6,29,367 which was due to the assessee from Shri P. M. G. Soundararajan had become bad and should not be included in the assessable wealth of the assessee?"

In the course of the proceeding before the Tribunal, the assessee, a trust, claimed that a sum of Rs.6,29,367 due to the assessee from the late E. M. Gopalakrishna Kone ought to be excluded on the ground that the debt was a bad debt and a time-barred one as well. Though the Assessing Officer took the view that the debt had not become a bad debt, the Commissioner of Wealth Tax concluded that the debt of Rs.6,29,367 could not be included in the wealth of the assessee as an asset and the assessing authority was directed to delete the same from the assessable wealth for the assessment years in question.

The Tribunal had found that the debt of Rs.6,29,367 due to the assessee from the adopted son of the borrower, E. M. Gopalakrishna Kone, should not be included in the assessable wealth of the assessee. While holding so, the Tribunal had referred to the fact that the borrower had died in the year 1959, and after his death, his adopted son did not incorporate this amount as a loan in the books of account. It was also further found by the Tribunal that the claim was barred by limitation. Considering these circumstances, the Tribunal upheld the order of the Commissioner holding that the debt in question had become a bad debt, and as such it could not be included in the assessable wealth of the assessee. On the available materials, the Tribunal cannot be said to have committed any error in coming to this conclusion, and we do not see any referable question of law arising out of the order of the Tribunal.

Though learned counsel for the Revenue strenuously contended that the Tribunal had not taken into account the letter of the assessee dated January 10, 1987, we find that that letter related only to the debts other than the debt in question, and in view of that, the Tribunal had not referred to that letter at all in, the course of its order. The omission to refer to this letter by the Tribunal in the course of its order certainly cannot give rise to a question of law on this aspect, as one arising out of the order of the Tribunal. We, therefore, dismiss the tax case petitions. There will be no order as to costs.

M.B.A./1067/F??????????????????????????????????????????????????????????????????????????????????? Petition dismissed.