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TMI Blog1983 (5) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... he Wealth-tax Rules, 1957 which was operative with effect from 1-4-1979 and which cannot be said to have retrospective operation ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is right in holding that even if a debt has become barred by limitation, it is still permissible as a liability as per section 2(m) of the Wealth-tax Act especially when such a debt, is not legally enforceable against the assessee and the creditors have no right to recover the money due through due progress of law ?" 2. We have heard at length, the learned departmental representative and the learned counsel for the assessee on various dates while the hearing was concluded on 15-4-1983. We have also gone through with utmost care the 'resume of argument' placed on our file for and on behalf of the assessee. This was filed at our behest and direction. 3. As regards question No. 2, the finding of the Tribunal are contained in paras 5 and 6 of its order dated 19-8-1982 supra and these paras stand reproduced hereunder 'in-verbatin' for ready reference : "5. As regards ground No. (2) which relates to claim of the assessee for deduction of Rs. 1,63,600 on account of liabilities, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1971-72, the revenue itself as allowed the deduction liabilities whereas the Tribunal has allowed it on the same reasoning for the earlier year, viz., 1970-71 and subsequent years, viz., 1972-73, 1973-74, 1974-75 and 1975-76. The reasoning of the Tribunal is that if the liabilities merit to be allowed in the assessment year 1971-72, there is no reason why for the earlier year as also for subsequent years these be not allowed. That apart, the Tribunal has also observed that limitation bars the remedy but does not extinguish the right and there cannot be two opinion about this proposition, hence, question No. 2 sought for by the revenue is hold to be not a question of law since the finding of the Tribunal are based on material on record, hence, we decline to refer this question to the Hon'ble High Court for esteemed opinion. 5. As regards common question No. 1, the answer to this question is self-evident since rule 1BB of the Wealth-tax Rules, 1957, is procedural and retrospective in nature and applies to all pending actions and in that view of the matter, we are not referring this question to the Hon'ble High Court for its esteemed opinion. For this proposition we rely upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Delhi High Court and following two questions were prayed for to be allowed, as arising from the order of the Tribunal : "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified and legally correct in applying the provisions of section 7(4) of the Wealth-tax Act which were effective from 1-4-1976 and holding that the valuation of the property for the assessment years 1973-74 to 1975-76 be taken at Rs. 2,38,000 for each year, subject to the self-occupancy allowance ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified and correct in law in not accepting the valuation of the self-occupied property adopted by the Wealth-tax Officer for the said three years on the basis of the report of the departmental valuation officer to whom the case was referred under section 16A of the Wealth-tax Act ?" The Hon'ble Delhi High Court vide judgment order dated 25-1-1982 made in WT Case No. 127 of 1979 held that, 'after hearing the learned counsel, we agree with the view of the Tribunal that no question of law arises out of the order of the Tribunal'. Petition of the revenue made under section 27(3) was dismissed by the H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tch if sold in the open market on the valuation date or, in the case of an asset being a house referred to in sub-section (4), the valuation date referred to in that sub-section. (4) Notwithstanding anything contained in sub-section (1), the value of a house belonging to the assessee and exclusively used by him for residential purposes throughout the period of twelve months, immediately preceding the valuation date may, at the option of the assessee, be taken to be the price which, in the opinion of the Wealth-tax Officer, it would fetch if sold in the open market on the valuation date next following the date on which he became the owner of the house, or on the valuation date relevant to the assessment year commencing on the 1st day of April, 1971, whichever valuation date is later : Provided that where more than one house belonging to the assessee is exclusively used by him for residential purposes, the provisions of this sub-section shall apply only in respect of one of such houses which the assessee may, at his option, specify in this behalf in the return of net wealth. Explanation : For the purposes of this sub-section --- (i) where the house has been constructed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in question as the relevant valuation dates thereof preceded 6-10-1967 ?" Their Lordships relying upon the ratio of the decision of the Hon'ble Supreme Court in the case of Izhar Ahmad Khan v. Union of India AIR 1962 SC 1052 upheld the finding of the Tribunal and the revenue met with failure. In the case of CWT v. Sripat Singhania [1978] 112 ITR 363 (All.), the Tribunal approved the assessee's method of valuation in respect of unquoted shares in preference to the valuation adopted by the wealth-tax authorities as per provisions of rule 1D, and here also the revenue went to the High Court against the order of the Tribunal, the stand of the revenue being that rule 1D was applicable and the order of the Tribunal was misconceived on facts and in law, the stand of the revenue was upheld and the Hon'ble High Court held that the Tribunal was not justified in approving the assessee's method of valuation which was not in accordance with rule 1D. Whereas in Laxmipat Singhania's case, the Tribunal held rule 1D was applicable, the revenue went to the Hon'ble High Court against that order and met failure while in Sripat Singhania's case, the stand of the revenue was that the Tribunal shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is only a question of law which is a substantial one and can be referred but the order of the Tribunal is based on material on record and is in the nature of finding of fact, hence, no question of law is involved since findings have not been challenged and for this proposition he has relied on the ratio of the decision in CIT v. Basanta Kumar Agarwalla [1983] 140 ITR 418 (Gauhati), CIT v. Chander Bhan Harbhajan Lal [1966] 60 ITR 188 (SC), N. N. Seshadrinathan v. State of Madras [1966] 60 ITR 482 (Mad.) (FB), CIT v. Indian Mica Supply Co. (P.) Ltd. [1970] 77 ITR 20 (SC) and Smt. Kusumben D. Mahadevia's case all being that of the Hon'ble Supreme Court. Other judgments relied upon by him are, New Bijli Foundry v. CIT [1981] 135 ITR 593 (Punj. Har.), CIT v. Tata Yadogawa Ltd. [1983] 142 ITR 30 (Pat.), Durga Associates v. State of U. P. AIR 1982 All. 490, Smt. Shanti Devi Jalan v. CIT [1983] 139 ITR 288 (Cal.), India Cements Ltd. v. CIT [1966] 60 ITR 52 (SC), CIT v. Sri Meenakshi Mills Ltd. [1967] 63 ITR 609 (SC), CIT v. Greaves Cotton Co. Ltd. [1968] 68 ITR 200 (SC) and 135 ITR 60 (sic.). Further reliance has been placed on the decision of Bombay Dyeing Manufacturing Co. Ltd. v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... getable Products Ltd. [1973] 88 ITR 192 (SC), Addl. CIT v. K. S. Sheik Mohideen [1978] 115 ITR 243 (Mad.) (FB), 1980 Excise Law Times, 521, 535 para 46 has also been pressed into service for the assessee. Jaswant Rai v. CWT [1977] 107 ITR 477 (Punj. Har.), CIT v. Ochhavlal Laljibhai Dharia [1980] 125 ITR 301, 320 (Guj.), AIR 1975 SC 2260, 2262 (sic), Shah Bhojraj Kuverji Oil Mills Ginning Factory v. Subhash Chandra Yograj Sinha AIR 1961 SC 1596, AIR 1967 SC 996 (sic), AIR 1961 SC 1550 (sic), Sadhu Singh v. Dharam Dev AIR 1980 SC 1654, Bal Dosabi v. Mathurdas Govinddas AIR 1980 SC 1334 and AIR 1981 SC 998 (sic), has also been relied upon. All the case laws relied upon by the assessee relate to the proposition that in view of interpretation given by the CBDT to rules 1C and 1D, the same treatment has to be given to rule 1BB since all these rules are subordinates legislation under section 7 and all these prescribed modes of valuation. 2. Since we have already held that the questions sought for by the revenue in the present applications are such that the answer to these questions is self-evident and since for this proposition we have relied upon the judgment order of the Hon'ble ..... X X X X Extracts X X X X X X X X Extracts X X X X
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