Commissioner of Wealth-Tax (Central), Kanpur vs D.P. Kanodia

The income tax Appellate Tribunal Allahabad referred the following, question of law u/s 27(1) of the Wealth Tax Act, 1957, hereinafter referred to as "the Act" for opinion to this Court.

"Whether on the facts and circumstances of the case, the I.T.A.T was correct in law in holding that the question of valuation was not referred to the proper valuer and directing the W.T.O. To refer the valuation again to the competent valuer, to determine the assessee''s share in the firm and not to go by valuation made by the Valuation Officer who had valued the assets of the firm."

The present Reference relates to the Assessment Years 1980-81 and 1981-82.

Briefly stated the facts giving rise to the present references are as follows:

The assessee are partners in the firm M/s Miss Shadi Lal Prasad. The Wealth-tax Officer made a reference to the Departmental Valuation Officer u/s 16A of the Act to value land, building, plant and machinery belonging to the above firm. After obtaining the valuation report, the Wealth-tax Officer completed the assessments of the assessee in accordance with the valuation report of the Departmental Valuation Officer.

Being aggrieved by the orders of the Wealth-tax Officer, the assessee preferred appeal to the Appellate Assistant Commissioner. It was contended before the Appellate Assistant Commissioner that the matter relating to the valuation should have been referred to the Authorised Valuation Officer for the purpose and not to the Valuation Officer appointed for valuation of land and building. Agreeing with the contention of the assessee, the Appellate Assistant Commissioner set aside the assessment orders on the point to be reframed afresh after referring the valuation of the assessee''s share in the partnership firm to the Authorised Valuation Officer having jurisdiction for the purpose.

At the time of hearing before the Tribunal, it was submitted before the Tribunal that similar issue had cropped up in the group of appeals relating to S/Shri B.N. Kanodia and D.P. Kanodia in W@.T.A. Nos. 210 to 225 (Alld) of 1986 and the Tribunal by its order dated 27th January, 1987 had decided the issue against the Revenue. Following the aforesaid decision, the Appellate Tribunal dismissed the departmental appeals.

We have heard Sri R.K. Upadhyay, learned counsel appearing for the Revenue and Sri R.S. Agrawal, learned counsel has filed his appearance on behalf of the respondent-assessee.

It has been stated that Sri R.K. Upadhyay that this Court in C.W.T. v. S.P. Kanodia, W.T. Reference No. 8 of 1993, dated 7-9-2006, had answered a similar question of law in favour of the assessee and against the Revenue. Respectfully following the aforesaid decision, we answer the question referred to us in the affirmative i.e., in favour of the assessee and against the Revenue. There shall be no order as to costs.