High Court Of Rajasthan
Commissioner Of Wealth Tax vs. Gopi Chand
Section WT 5(1)(xxxii), WT 27(3)
Asst. Year 1978-79
J.S. Verma, C.J. & I.S. Israni, J.
WT Ref. No. 228 of 1988
24th May, 1988
Counsel Appeared
V. K. Singhal, for the Revenue : N. M. Ranka, for the Assessee
BY THE COURT :
This is an application under s. 27(3) of the WT Act, 1957, by the CWT for a direction to the Tribunal to state the case and refer certain questions of law said to arise out of the Tribunal’s order to this Court for its decision.
The relevant assessment year is 1978-79. The questions relate to the applicability of r. 2B(2) of the WT Rules, 1957, and the exemption claimed by the assessee under s. 5(1)(xxxii) of the WT Act. The Tribunal has declined to refer both these questions under s. 27(1) of the Act. Hence, this application under s. 27(3) of the Act.
In our opinion, questions of law do arise with regard to the applicability of r. 2B(2) of the WT Rules as well as the exemption under s. 5(1)(xxxii) of the WT Act. The question of applicability of r. 2B (2) arises where determination of the market value of the closing stock is at an amount exceeding by more than 20 per cnet. the value disclosed in the balance-sheet. The dispute between the parties is with regard to the onus of proving the market value of the closing stock at an amount which results in attracting r. 2B(2). The question of onus of proof requires construction of a statutory provision and it does raise a question of law. Similarly, the question of exemption under s. 5(1)(xxxii) of the WT Act, 1957, requires construction of a statutory provision read along with the Expln. to s. 5(1)(xxxi). Accordingly, a question of law arises in this behalf as well.
Consequently, this application is allowed and the Tribunal is directed under s. 27(3) of the Act to state the case and to refer to this Court for its decision the following questions of law, namely :
” (1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the onus of proof that the market value of the closing stock exceeded by more than 20 per cnet. the value disclosed in the balance-sheet of the firm was on the Revenue, and the same not having been proved, r. 2B(2) of the WT Rules, 1957, was not attracted ?
(2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee’s interest in the firm is exempt under s. 5(1)(xxxii) r/w the Expln. to s. 5(1) (xxxi) of the WT Act, 1957 ?”
We direct accordingly.
No costs.
[Citation : 176 ITR 150]
