| Case ID |
31a241ba-8600-40a5-a8a2-990be4b478a7 |
| Body |
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| Case Number |
Wealth Tax Reference No. l of 1996 |
| Decision Date |
Jan 19, 1998 |
| Hearing Date |
|
| Decision |
The court ruled that Rule 1-D of the Wealth Tax Rules, 1957, is valid and must be adhered to when valuing unquoted equity shares of companies, excluding investment companies or managing agencies. The court emphasized that if advance tax is shown as a liability in a company's balance sheet, it should be excluded from the provision for taxation. The Tribunal's previous decisions were referenced to uphold that the market value of shares must be determined according to the stock exchange quotations, provided those shares are regularly quoted. The case was remanded for further proceedings in accordance with the Supreme Court's directive, reinforcing the mandatory nature of Rule 1-D. |
| Summary |
The case involved the valuation of unquoted equity shares under the Wealth Tax Act and the applicability of Rule 1-D of the Wealth Tax Rules, 1957. The Gauhati High Court addressed whether the valuation should reflect stock exchange quotations when such shares are not regularly traded. The court highlighted the importance of adhering to regulatory provisions for accurate asset valuation, particularly for wealth tax assessments. The decision reinforced the mandatory nature of Rule 1-D, ruling that advance tax liabilities must not be considered in the valuation process. This ruling is crucial for ensuring compliance with tax regulations and accurate reporting of wealth tax liabilities, impacting future assessments and legal interpretations. |
| Court |
Gauhati High Court
|
| Entities Involved |
Not available
|
| Judges |
V. D. GYANI,
D. BISWAS
|
| Lawyers |
Mr. Joshi
|
| Petitioners |
COMMISSIONER OF WEALTH TAX
|
| Respondents |
AJOY KUMAR SAHARIA
|
| Citations |
1999 SLD 694,
1999 PTD 1215,
(1998) 233 ITR 29
|
| Other Citations |
Bharat Hari Singhania v. C.W.T. (1994) 207 I T R (SC)
|
| Laws Involved |
Wealth Tax Act, 1957,
Wealth Tax Rules, 1957
|
| Sections |
27(3),
1D
|