| Case ID |
1b8752b5-c548-4deb-8e27-54850ff3d1f0 |
| Body |
View case body. Login to View |
| Case Number |
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| Decision Date |
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| Hearing Date |
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| Decision |
The court ruled that the amount paid as compulsory deposit under the Compulsory Deposit Scheme, 1974, is exempt from wealth-tax. The Tribunal's decision to treat the compulsory deposit as exempt was upheld, as the Finance Act, 1980, introduced section 7A, indicating that such deposits should be considered banking deposits for the purpose of exemption under the Wealth-tax Act. Thus, the compulsory deposits were not liable to wealth-tax, affirming the Tribunal's ruling. |
| Summary |
This case revolves around the exemption of compulsory deposits under the Compulsory Deposit Scheme from wealth-tax. The Gujarat High Court examined whether the amount paid as compulsory deposit is exempt from wealth-tax under the Wealth-tax Act, 1957. The Tribunal had previously ruled in favor of the assessee, leading to this reference. The court highlighted the significance of section 7A introduced by the Finance Act, 1980, which deems compulsory deposits as banking deposits, thereby qualifying them for exemption. The court's decision reinforces the legislative intent to treat these deposits as assets not subject to wealth-tax. This ruling is crucial for taxpayers and legal practitioners dealing with wealth taxation, as it clarifies the status of compulsory deposits and their treatment under tax laws. |
| Court |
Gujarat High Court
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| Entities Involved |
Not available
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| Judges |
M.S. Shah,
K.A. Puj
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| Lawyers |
Tanvish U. Bhatt
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| Petitioners |
Commissioner of Wealth Tax
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| Respondents |
Smt. Avaniben Ajaybhai
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| Citations |
2002 SLD 2952 = (2002) 258 ITR 542
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| Other Citations |
Smt. Sunanda Devi Singhania v. CWT [1993] 204 ITR 842 (Cal.),
WTO v. S.D. Nargolwala [1983] 5 ITD 690 (Delhi)
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| Laws Involved |
Wealth-tax Act, 1957,
Compulsory Deposit Scheme (Income-tax Payers) Scheme, 1974
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| Sections |
2(m),
7A
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