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TMI Blog1978 (7) TMI 168X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 18,813. On appeal the AAC noticed that the cost as on 1st Jan., 1954 as per the balance sheet of the above company as on 31st Dec., 1953 was Rs. 131.10. He observed that the WT Act came into force only from 1957 and therefore the cost as on 1st Jan., 1954 should be taken as per the balance sheet at Rs. 131.10. He directed the ITO to substitute the same in the place of Rs. 111.43 adopted by him. Aggrieved by this order of the AAC department has come on appeal before us. 3. On behalf of the revenue it was argued that for the Asst. yr. 1976-77 the WT Act was in force and therefore r. 1D of the W.T. Rules would be applicable to this case. It was submitted that applying the above rule reduction of 15per cent should be given in the break-up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urged that in any event r. 1D of the WT Rules was framed in exercise of the powers conferred by s. 46 of the WT Act, which came into force from 1st Apr., 1957 and that the same would not apply retrospectively to evaluate the fair market value as on 1st Jan., 1954 in the absence of an express provision in the legislation. He further pointed out that even assuming that WT Rules could be applied to Income-tax proceedings, r. 1D of WT Rules cannot be applied to this case because r. 1D would apply only to determine the market value of unquoted equity shares of companies other than managing agency company, here as TVS Sons Ltd. was a managing agency company in the year 1954. He then referred us to the Circular No. 2(WT) dated 31st Oct., 1976 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he value of original share as on 1st Jan., 1954 from the break-up value of Rs. 131.10, 15per cent should be deducted. Dealing with this contention the Tribunal observed as under:- "We do not find any jurisdiction to deduct that sum because in-so-far as the capital gains is concerned, no such rule, as it existed for Wealth-tax, is applicable. Therefore, there is no justification to deduct 15per cent from the figure determined as the break-up value." In the instant case, it is common ground that as per the balance sheet as on 31st Dec., 1953 the cost of the original share holdings per share as on 1st Jan., 1954 worked out to Rs. 131.10, as in that appeal. Following the reasoning found in the above order of the Tribunal, which squarely app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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