Gujarat H.C : Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in coming to the conclusion that the assessee was entitled to exemption under s. 5(1)(xxxiii) of the WT Act ?

High Court Of Gujarat

Commissioner Of Wealth Tax vs. Ravjibhai Panchanbhai Patel

Sections WT 5(1)(xxxiii)

Asst. Year 1977-78, 1978-79, 1979-80

C.K. Thakker & A.L. Dave, JJ.

WT Ref. No. 47 of 1984

1st September, 1999

Counsel Appeared

B.B. Naik with Manish R. Bhatt, for the Petitioner : None, for the Respondent

JUDGMENT

C.K. THAKKER, J. :

The following question is referred for the opinion of this Court : “Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in coming to the conclusion that the assessee was entitled to exemption under s. 5(1)(xxxiii) of the WT Act ?”

2. Short facts of the case are that the assessee claimed exemption under s. 5(1)(xxxiii) of the WT Act, 1957 (hereinafter referred to as “the Act”). Under the said provision, the value of any assets brought into India by a person of Indian origin who was ordinarily residing in a foreign country and who, on leaving such country, has returned, to India with the intention of permanently residing therein is exempted from payment of wealth-tax for a period of seven successive years commencing with the assessment year next following the date on which such person returned to India. The provision came into force w.e.f. 1st April, 1977. It is an admitted fact that the assessee came to India on 20th Feb., 1973, with the intention of permanently staying here.

3. For the assessment years in question, i.e., 1977 to 1980, the WTO rejected the claim of the assessee on the ground that the exemption would begin immediately from the assessment year next to the one in which the person came to India and there was no warrant for any gap for commencement of exemption after the return of the person to India. According to the WTO, as the clause operated from 1st April, 1977, it could not be invoked by a person like the assessee, who returned to India before 1st April, 1976, i.e., who came to India in February 1973. The AAC, however, granted the exemption on the ground that the period of seven years has to be counted from the date of return to India. In further appeal by the CWT to the Tribunal, the Tribunal observed as under : “When this exemption came into effect the fact that the assessee had come to India, did remain a fact and that is the only thing which is required under the provision because it uses the expression ‘has returned to India’. Therefore, the period of seven years would begin to run from the assessment year next following the date on which the person returned to India. The result would be that the assessee would lose exemption for the asst. yr. 1973-74 to 1976-77 but he would be entitled to the exemption for the asst. yr. 1977-78, 1978-79 and 1979-80. The AAC’s order is confirmed and the appeals are rejected.”

4. In our opinion the construction which has been put by the Tribunal is in accordance with law. It, therefore cannot be said that the Tribunal has committed any error in coming to the conclusion that the assessee was entitled to exemption under s. 5(1)(xxxiii) of the Act.

5. For the foregoing reasons, the reference must be answered in the affirmative, i.e., in favour of the assessee and against Revenue. Reference accordingly disposed of.

No order as to costs.

[Citation : 252 ITR 184]

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