1992 (6) TMI 47 - AT - Wealth-tax

Summary

Issues Involved:
1. Reopening of the case under section 17(1) of the Wealth-tax Act.
2. Inclusion of the value of annuity policies in the wealth of the appellant.
3. Inclusion of the value of royalties not accrued on the valuation date in the wealth of the appellant.
4. Valuation of professional annuities at a discount rate to determine present value.

Detailed Analysis:

1. Reopening of the Case under Section 17(1) of the Wealth-tax Act:
The primary issue in the assessee's appeals for the assessment years 1977-78 to 1981-82 was the objection to the reopening of the case under section 17(1) of the Wealth-tax Act. The assessee, a renowned playback singer, contended that the reopening was barred by limitation and challenged the applicability of section 17(1)(a) versus section 17(1)(b). The Tribunal noted that the basic facts, such as the dates of notices and their service, were not furnished, and no specific finding was recorded by the CWT(Appeals) regarding the limitation. The Tribunal upheld the Department's action under section 17(1)(a), stating that the assessee had not disclosed the existence of the right to receive future royalties on future sales of gramophone records at the time of the original assessments. The Tribunal concluded that the non-disclosure of this primary fact justified the reopening of the case under section 17(1)(a).

2. Inclusion of the Value of Annuity Policies in the Wealth of the Appellant:
The second ground of appeal for the assessment year 1977-78 was the inclusion of the value of annuity policies in the appellant's wealth. The CWT(Appeals) had followed the ITAT decision for the assessment year 1982-83, which the assessee's advocate conceded to leave to the Tribunal's discretion. The Tribunal found no substance in this ground and rejected the appeal.

3. Inclusion of the Value of Royalties Not Accrued on the Valuation Date in the Wealth of the Appellant:
The third ground of appeal for the assessment year 1977-78 concerned the inclusion of royalties not accrued on the valuation date in the appellant's wealth. The CWT(Appeals) had again followed the Tribunal's previous order. The assessee's advocate did not contest this point further, and the Tribunal rejected this ground as well.

4. Valuation of Professional Annuities at a Discount Rate to Determine Present Value:
In the Department's appeals, the substantive ground was the valuation of professional annuities at a discount rate of 25 percent to determine the present value of future receivables. The CWT(Appeals) had followed the Tribunal's decision in this regard. The Tribunal rejected the Department's appeal, upholding the CWT(Appeals)'s decision.

Conclusion:
The Tribunal dismissed all twelve appeals, both from the assessee and the Department, thereby upholding the reopening of the case under section 17(1)(a), the inclusion of the value of annuity policies and royalties not accrued on the valuation date in the appellant's wealth, and the valuation of professional annuities at the specified discount rate.