COMMISSIONER OF WEALTH TAX VS S. SIVARATHINA PANDIAN
2001 P T D 855
[241 I T R 146]
[Madras High Court (India)]
Before R. Jayasimha Babu and Mrs. A. Subbulakshmy, JJ
COMMISSIONER OF WEALTH TAX
versus
S.V. SIVARATHINA PANDIAN
Tax Case No.1082 of 1990 (Reference No.538 of 1990), decided on 25/03/1999.
Wealth tax‑‑‑
‑‑‑‑Revision‑‑‑Powers of CWT‑‑‑Meaning of "record" for purposes of revision‑‑‑Record includes material available at time of examination by CWT‑‑‑Wealth Tax Officer referring question of valuation of properties to Valuation Officer under S.16A‑‑‑Report of Valuation Officer received after completion of assessment‑‑‑Commissioner could take such valuation into consideration in passing order under S.25(2) setting aside assessment‑‑ Indian Wealth Tax Act, 1957, S.25(2).
The Wealth Tax Officer adopted an estimated value of Rs.3 lakhs, Rs.2 lakhs and Rs.1.25 lakhs in respect of three different properties respectively as against the values Rs.1,06,000, Rs.84,750 and Rs.47,504, respectively, made in the return submitted by the assessee. The Wealth Tax Officer referred the question of valuation under section 16A of the Wealth Tax Act, 1957, to the Valuation Officer and received tentative valuation proposals from the Valuation Officer on February 24, 1986. As the assessment was getting time‑barred by March 31, 1986, the Wealth Tax Officer completed the assessment on the estimated value mentioned above, on March 17, 1986. The final valuation was received by the Wealth Tax Officer on March 26, 1986, determining the valuation at higher figures. The Commissioner of Wealth Tax, acting under section 25(2) of the Act, set aside the assessment, directing the Wealth Tax Officer to redo the assessment adopting the correct valuation as per valuation report. On appeal, the Tribunal set aside the order of the Commissioner of Wealth Tax, holding that the "record" in section 25(2) could not mean the record as it stood at the time of examination by the Commissioner, but it meant the record as it stood at the time the order was passed by the Wealth Tax Officer. On a reference:
Held, that the Commissioner of Wealth Tax was perfectly justified in setting aside the order of assessment and directing the Wealth Tax Officer to redo the assessment, taking into consideration the records relating to the proceedings available at the time of examination by the Commissioner of Income‑tax and that the record was not confined to the material available to the Income‑tax Officer.
CIT v. Shree Manjunathesware Packing Products and Camphor Works (1998) 231 ITR 53 (SC) fol.
Ganga Properties v. ITO (1979) 118 ITR 447 (Cal.) ref.
C.V. Rajan for the Commissioner.
Nemo for the Assessee.
JUDGMENT
MRS. A. SUBBULAKSHMY, J.‑‑‑At the instance of the Revenue, the following question has been referred to us, viz., "whether, on the facts and in the circumstances of the case, the Tribunal having found that the Wealth Tax Officer adopted the figures of valuation much lower than the proposed valuation of the Valuation Officer, was right in law in holding that the Commissioner was not justified in invoking revisional jurisdiction by acting on material which did not form part of the record of assessment?"
The assessee is an individual who owns several properties. The Wealth Tax Officer adopted an estimated value of Rs.3 lakhs, Rs.2 lakhs and Rs.1.25 lakhs in respect of three different properties respectively as against the sums Rs.1,06,000, Rs.84,750 and Rs.47,504, respectively, made in the return submitted by the assessee. The Wealth Tax Officer referred the question of valuation under section 16A to the Valuation Officer and received tentative valuation proposals from the Valuation Officer on February 24, 1986. As the assessment was getting time‑barred by March 31, 1986, the Wealth Tax Officer completed the assessment on March 17, 1986, adopting the estimated figures of valuation as stated above, which were less than the figures of tentative valuation proposals. The final valuation was received by the Wealth Tax Officer on March 26, 1986, determining the valuation at higher figures. The Commissioner of Wealth Tax acting under section 25(2) of the Act set aside the assessment directing the Wealth Tax Officer to redo the assessment adopting the correct valuation as per the valuation report: On appeal, the Tribunal set aside the order of the Commissioner of Wealth Tax, relying on the decision of the Calcutta High Court in Ganan Properties v. ITO (1979) 118, ITR 447, holding that the word "record" in section 25(2) of the Act could not mean the record as it stood, at the time of examination by the Commissioner, but it meant the record as it stood at the time of the order passed by the Wealth Tax Officer.
The Supreme Court in the case of CIT v. Shree Manjunathesware Packing Products and Camphor Works (1998) 231 ITR 53, has held that the Commissioner of Income‑tax can take into consideration the record relating to the proceedings available at the time of examination by the Commissioner of the Income‑tax and the record is not confirmed to the material available to the Income‑tax Officer. Following the aforesaid decision of the Supreme Court, we hold that the Commissioner of Wealth Tax was perfectly justified in setting aside the order of assessment and directing the Wealth Tax Officer to redo the assessment taking into consideration the relevant proceedings available at the time of examination.
The order of the Tribunal is not justifiable. We answer the question referred to us in favour of the Revenue and against the assessee.
M.B.A./415/FC Reference answered.