Bombay H.C : The WTO was not competent to rectify the assessment of the assessee to tax the value of jewellery on the ground that there was no mistake apparent from the records capable of rectification under s. 35 of the WT Act

Counsel Appeared

G. S. Jetly & S. V. Naik, for the Revenue : N. A. Dalvi, i/b M/s. Mulla & Mulla & Craigie, Blunt & Caroe, for the Assessee

BHARUCHA, J.:

This reference is made at the instance of the Revenue. The question raised is this: ” Having regard to the fact that the amendment to s. 5(1)(viii) of the WT Act, 1957, was expressly given retrospective effect by s. 32 of the Finance (No. 2) Act, 1971, whether the Tribunal was right in holding that the WTO was not competent to rectify the assessment of the assessee to tax the value of jewellery on the ground that there was no mistake apparent from the records capable of rectification under s. 35 of the WT Act ?”

The answer to be given to the question is squarely covered by the judgment of the Supreme Court in J. M. Bhatia, AAC vs. J. M. Shah (1985) 156 ITR 474. Having regard to that judgment, the question posed to us must be answered in favour of the Revenue. Mr. Dalvi, learned counsel for the assessee, however, submitted that what was encompassed in the word “jewellery” was itself a debatable question and that, therefore, the rectification proceedings could not have been started. He submitted that the reference by the Tribunal in its order to the case of Ramesh Mafatlal (WT Applications Nos. 1498 of 1966-67 (A.Y. 1964-65) and 918 (Bom.) of 1967-68 (A.Y. 1966-67)), showed that this point had been urged on behalf of the assessee before the Tribunal.

We will assume that this point was urged before the Tribunal. We, however, do not find the point referred to us. The only point in the question that is referred is whether the WTO was competent to rectify the assessment of the assessee to bring to tax the value of jewellery in the light of the retrospective effect given to the amendment to s. 5(1)(viii) of the WT Act, 1957. We cannot, therefore, consider the point urged by Mr. Dalvi before us.

The question has to be answered, having regard to the Supreme Court judgment referred to above, in favour of the Revenue.

In applying the provisions of s. 5(1)(viii) of the WT Act, 1957, the Tribunal shall, of course, consider whether the ornaments belonging to the assessee fall within the meaning of the word “jewellery” therein. No order as to costs.

[Citation : 171 ITR 191]