| Case ID |
202d2857-5056-42f9-a402-15500f68428a |
| Body |
View case body. Login to View |
| Case Number |
Tax Reference Case Nos. 18 and 19 of 1981 |
| Decision Date |
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| Hearing Date |
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| Decision |
The court held that the interest of a partner in a firm can be determined by applying the provisions of section 7 of the Wealth-Tax Act, 1957, along with rule 2 made thereunder. The assessment years in question were 1974-75 and 1975-76. It was determined that if the balance sheet of a firm does not correctly reflect the values of the assets held, the assessing officer has the discretion to make adjustments. The court affirmed the valuation made by the Wealth Tax Officer (WTO) based on the market value of the assets, stating that the normal rule for valuation is to determine the market price of assets, excluding cash. The decision followed the precedent set in Juggilal Kamlapat Bankers v. WTO, emphasizing that the balance sheet serves as a starting point for valuation but is not conclusive. |
| Summary |
This case revolves around the interpretation of section 7 of the Wealth-Tax Act, 1957, which deals with the valuation of assets held by a partner in a firm. The Karnataka High Court addressed the assessment years 1974-75 and 1975-76 and determined the appropriate method for valuing a partner's interest in a firm. The case involved significant legal principles regarding asset valuation, particularly the discretion of the assessing officer to adjust values when the balance sheet does not accurately reflect market conditions. The court's decision draws heavily on established precedents, reinforcing the importance of accurate asset valuation in tax assessments. Keywords for SEO include 'Wealth-Tax Act', 'asset valuation', 'partner's interest', 'Karnataka High Court', 'market value determination', and 'tax assessment'. These terms are crucial for legal professionals and taxpayers seeking clarity on wealth tax implications. |
| Court |
Karnataka High Court
|
| Entities Involved |
Not available
|
| Judges |
K. SHIVASHANKAR BHAT,
S. RAJENDRA BABU
|
| Lawyers |
K. Srinivasan,
S.G. Shivaram,
H. Raghavendra Rao
|
| Petitioners |
Illahi Baksh
|
| Respondents |
Commissioner of Wealth Tax
|
| Citations |
1990 SLD 1908,
(1990) 183 ITR 331
|
| Other Citations |
Juggilal Kamlapat Bankers v. WTO [1984] 145 ITR 485 (SC),
Birla Jute Mfg. Co. Ltd. v. CWT [1971] 82 ITR 142 (SC),
CWT v. Tungabhadra Industries Ltd. [1966] 60 ITR 447 (Cal.)
|
| Laws Involved |
Wealth-Tax Act, 1957
|
| Sections |
7
|