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TMI Blog1987 (2) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... of net wealth had been required to be filed by any statutory notice issued by the WTO under the Act. Nevertheless, the WTO for the first time issued notice under section 17 of the Act for all the years under appeal. The assessee responded to this notice by filing the wealth-tax returns for all the years simultaneously on 23-4-1979. The net wealth declared in such returns was Rs. 1,79,671, Rs. 3,11,770, Rs. 2,67,420, Rs. 2,67,720, Rs. 2,66,310 and Rs. 1,69,000 respectively for the assessment years 1970-71 to 1975-76 as recorded by the WTO in the impugned assessment orders all framed on 19-11-1984. The revised returns were filed in the status of an AOP. In the letter dated 13-5-1981 addressed to the WTO, Distt. X(7), New Delhi, the assessee pointed out that in good faith and without knowing the exact position under the Act returns relating to the assessment years 1970-71 to 1975-76 were filed in response to notice under section 17 and the assessee also paid tax under section 15B of the Act on the basis of the returns as per challan for the first five years dated 19-5-1975 and for the last year dated 7-1-1979. The assessees further stated that they had discussed this matter with thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ta Agarwal in which the judgment of the Hon ble Supreme Court in the case of C.K. Mammed Kayi has been considered. It was further contended that section 21AA, introduced into the Act, with effect from 1-4-1981 is only clarificatory in nature and does not affect the impugned assessments, which are validly made by the WTO. It was thus contended that taking into consideration the provisions of section 21AA read with section 4(1)(b) of the Act and the ratio of the judgments relied upon by the revenue, the learned AAC erred in holding that the AOP does not come within the ambit of the word individual and hence is not an assessable entity under the provisions of the Act. His order may, therefore, be set aside and the order of the WTO restored in its place. 7. The assessee, on the other hand, relied upon the judgments in the case of Royal Calcutta Turf Club v. WTO [1984] 148 ITR 790 (Cal.); Willingdon Sports Club v. C.B. Patel, Third Addl. WTO [1982] 137 ITR 83 (Bom.); Orient Club v. CWT [1982] 136 ITR 697 (Bom.) and Orient Club v. WTO [1980] 123 ITR 395 (Guj.). The assessee also pointed out that there are judgments in favour of the revenue in State Bank of India Officers Association ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e considering the charge of tax under the Expenditure-tax Act, 1957, inter alia, observed that under the charging section tax is imposed on individuals and HUFs. An undivided family which consists of Hindus alone may be treated as a unit of assessment : an undivided family whose members are not Hindus will be assessed to tax as an individual. This observation was made by the Court in the context of liability to tax of the Mappilla families governed by the Maru Makkathyam law residing in a small part of the country and forming numerically a small community. The Court held so, taking into consideration, the long course of legislative history in matters of taxing income, wealth, etc., regarding undivided families. The Hon ble Court again in the case of C.K. Mammed Kayi relying upon its judgment in the case of V. Venugopala Ravi Varma Rajah held that the expression individual in section 3 includes within its ambit Mappilla Maru Makkathyam Tarwads and they are well within the purview of the taxing provisions of the enactment. Thus, it would be seen that the observations of the Court that the term individual in section 3 includes body of individuals were in specific reference to co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidual entity for the purpose of the Act and as such it is not chargeable to wealth-tax in view of the specific provisions of the charging section 3. 16. Thus, it is clear from what is stated above that there is a school of thought amongst the judiciary of the country taking into consideration the judgment of the Hon ble Supreme Court in the case of C.K. Mammed Kayi and the provisions of the Act that an association of persons cannot be taxed for the assessment years under appeal as an individual . On the other hand, there is another school of thought as would be clear from the following judgments which believes that the same judgment of the Hon ble Supreme Court in the case of C.K. Mammed Kayi justifies the decision that an association of persons is taxable under the Act as an individual . 17. We may first have a look at the judgment of the Madras High Court in the case of Coimbatore Club. In this judgment, the Hon ble Court held that the expression individual occurring in section 3 will include within its scope a plurality of individuals or BOIs forming a single collective unit knit together by ties of common aims and joint interest without any profit motive but owning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined from making an association of persons as a taxable entity by omitting the mention thereof in charging section 3. 20. It is well settled rule of construction of interpretation of a fiscal statute that nothing should be added and nothing should be subtracted and the Act should be interpreted as it is. Since the word association of persons is not mentioned in section 3, it cannot be added by implication so as to bring association of persons to charge under the Act in the status of individual . 21. The assessments before us relate to the assessment years 1970-71 to 1975-76. For these assessments relevant dates of valuation are 31st of March of the respective assessment year. They all fall prior to 1-4-1981. The Legislature inserted, by the Finance Act, 1981 with effect from 1-4-1981, section 21AA. This section provides that where assets chargeable to tax under this Act are held by an association of persons , other than a company or a co-operative society, and the individual shares of the members of the said association in the income or assets or both of the said ssociation on the date of formulation or at any other time thereafter are indeterminate or unknown, the weal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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