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686/CBDT. - Income Tax - 686/CBDTExtract INSTRUCTION NO. 686/CBDT Dated : April 20, 1974 Section(s) Referred: 5 Statute: Wealth Tax Act, 1957 Under clauses (xvi) and (xvia) of Section 5 of the Wealth-tax Act, various securities listed therein are exempt from Wealth-Tax and any security of the Central Government or State Government not being a security listed in the said clauses is also exempt in terms of clause (xxii) of the same section. Exemption of these securities is restricted to Rs.1,50,000 along with several other assets as mentioned in sub section 1 A of section 5. In terms of sub-section 2 of section 5 of W.T.Act, Wealth-tax shall not be payable by an assessee in respect of any security of the Government or of local authorities not specified in clauses (xv), (xvi) or (xvia) of sub-section (1) which Central Government may by notification in the official Gazettee exempt from Wealth-tax; but the value of any such security so exempted shall be included in computation of net wealth of the assessee. It would, therefore, appear that some securities which are exempt in terms of clause (xxii) of sub-section (1) of Section 5 of the W.T.Act may also be covered by a notification referred to in sub-section (2) of section 5 of the W.T.Act. 2. The Board are advised that even securities which may be notified u/s.5(2) of the W.T.Act will have to be excluded from the computation of wealth to the extent permitted by the overall exemption of Rs.1,50,000 specified in sub-section 1A of the same section and only the value of these securities which are in excess of the amount included in the overall exemption of Rs.1,50,000 would enter into computation for determining the Wealth-tax rates applicable. 3. The contents of this letter may please be brought to the notice of all the assessing officers.
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