Section 5(1)(xxvb) of the Wealth-tax Act, 1957-Whether exemption of the deposits made under the National Savings Scheme, 1987, from wealth-tax contained in clause (xxvb) of sub-section (1) of section 5 of the Wealth-tax Act is not subject to the limit of Rs. 5 lakhs specified in sub-section (1A) of - Income Tax - 511/1988

Section 5(1)(xxvb) of the Wealth-tax Act, 1957-Whether exemption of the deposits made under the National Savings Scheme, 1987, from wealth-tax contained in clause (xxvb) of sub-section (1) of section 5 of the Wealth-tax Act is not subject to the limit of Rs. 5 lakhs specified in sub-section (1A) of section 5 of that Act Circular No. 511 Dated 10/5/1988 1. The Finance Act, 1987, introduced a new section 80CCA in the Income-tax Act to provide for deduction in respect of investments made under the National Savings Scheme, 1987. Corresponding amendment was made in the Wealth-tax Act to provide for exemption from wealth-tax in respect of deposits made under this Scheme. 2. References have been received from some quarters enquiring whether the investments made under the Scheme are exempt from wealth-tax without limit or whether the exemption is limited to Rs. 5 lakhs together with other specified assets provided in section 5(1A) of the Wealth-tax Act. 3. It is hereby clarified that the exemption of the deposits made under the National Savings Scheme, 1987, from wealth-tax, contained in clause (xxvb) of sub-section (1) of section 5 of the Wealth-tax Act is not subject to the limit of Rs. 5 lakhs specified in sub-section (1A) of section 5 of that Act. The deposits under the Scheme are exempt from wealth-tax without any limits. Accordingly, the last sentence of Paragraph 31.1 of the Board's Circular No. 495 dated 22nd September, 1987-See [1987] 168 ITR (St.) 87, containing the Explanatory Notes on the provisions of the Finance Act, 1987, relating to direct taxes stands modified.