Wealth Tax Act - Adherence to provisions of Sec.16A while making assessments. - Income Tax - 1600/CBDT

INSTRUCTION NO. 1600/CBDT Dated: February 14, 1985 The Public Accounts Committee have in a number of Reports pointed out that instances are not lacking wherein the Wealth-tax Officers completed the assessments without making necessary references to the Valuation cell. They have taken exception to such instances being repeated inspite of their repeated observations and repeated instructions of the CBDT. 2. The Board would therefore like to emphasise strict adherence to the provisions of sec.16 A which lays down that the wealth-tax officer may refer the valuation of any asset to a valuation officer in the following circumstances: (i) Where the value of the asset is based on the valuation by the registered valuer and the wealth-tax officer is of the opinion that the value returned is less than the fair market value. (ii)In other cases if the Wealth-tax officer is of the opinion that the fair market value of the asset exceeds the returned value thereof by 1/3rd or by more than Rs.50,000. (iii)If the wealth-tax officer is otherwise of the opinion that having regard to the nature of the asset and other relevant circumstances it is necessary to make a reference. 3. Attention is in particular drawn to the instructions in this behalf contained in the Explanatory notes on the provisions of the Taxations Laws (Amendment) Act, 1972 issued under circular No.96 dated 25th November, 1972 in F.No.132(1)/72-TPL. In para 35 it has been clearly stated: In the cases covered by sec 16 A(1) , it will be incumbent on the Wealth-tax officer to refer the valuation of the asset in question to the valuation officer and it will not be open to him to decide the question of valuation on his own. 4. For removal of doubts it may be stated here that Instruction No.365 dated 28-12-71 in F.No.319/5/70-WT have been superseeded by the provisions of the Taxation Laws(Amendment) Act, 1972 and these instructions laying down monetary limit etc., have survived in respect of Estate Duty cases only. 5. The Board desire that while completing Wealth-tax assessments the Wealth-tax Officers in accordance with the provisions of sec.16A. 6. These instructions may please be specifically brought to the notice of all officers working in your charge for compliance and an intimation to this effect may be sent to the undersigned.