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TMI Blog2009 (7) TMI 834X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009 & 28 of 2009 - - - Dated:- 24-7-2009 - RAMACHANDRAN NAIR C. N., ABDUL REHIM C. K. JJ P.K.R. Menon and Jose Joseph for the Appellants. P. Balakrishnan, T.M. Sreedhran, Smt. C.K. Sherin, V.P. Narayanan, S, Arun Raj And A. Kumar for the Respondent. WTA Nos. 1 to 5,7 11 to 18 28/2009 4,6 to 12,15 to 18, 21 to 23 25/2008 JUDGMENT The judgment of the court was delivered by C. N. Ramachandran Nair J.- These connected wealth-tax appeals are filed by the Revenue against the order of the Tribunal holding that cash in hand in excess of Rs. 50,000 in the hands of the assessees who are all individuals, does not form part of the asset under section 2(ea)(vi) of the Wealth-tax Act. We have heard senior counsel Sri P. K. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sset and being productive it is not to be treated as asset within the meaning of the above clause. The assessees have relied on the Speech made by the Finance Minister while introducing the Finance Bill, 1992 containing the above provision for exemption and they have also relied on the two decisions of the Supreme Court in Apollo Tyres Ltd. v. CIT [2002] 255 ITR 273 ; [2002] 9 SCC 1 and in Kerala State Industrial Development Corporation Ltd. v. CIT [2003] 259 ITR 51 ; [2003] 11 SCC 363. 4. The Wealth-tax Act was amended by the Finance Act, 1992 to implement the recommendations of the Chelliah Committee. The Committee's recommendations are extracted in the Budget Speech of the Finance Minister, the relevant portion of which is extracted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imulating investment in productive assets, the Finance Act has abolished wealth-tax on all assets except certain specified assets. The term `asset' will include guest houses and residential houses including farm houses within twenty-five kilometres from the local limits of any municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee or by any other name) or a cantonment board but does not include a house which has been allotted by a company to an employee or an officer, or a director who is in the whole time employment, having a gross annual salary of less than two lakh rupees. It will also not include a house for residential purposes which forms part of stock-in-trad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meaning of the section. The Act provides for wealth-tax on three categories of assessees, namely, individuals, HUFs and companies. "Asset" as defined under section 2(e) of the Act, which stood in force until March 31, 1992 included property of every description, movable or immovable, except the items excluded in the sub-clauses provided therein. In other words, property of every description other than those which were specifically excluded were subject to wealth-tax. However, after the amendment, Parliament based on the recommendations of the Chelliah Committee, identified non-productive assets and classified the same under the new definition clause (ea) introduced to section 2 providing for wealth-tax only on such of the assets enumerated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce that the assets described in the sub-clauses are taxable assets. While cash in hand in excess of Rs. 50,000 has to be treated as an "asset" of individuals and HUFs, any cash in hand for other persons, namely, companies, not recorded in the books of account is an asset. We do not find any ambiguity in the section which is plain and clear and is capable of no other meaning except what is stated above. 7. The question now to be considered is whether the respondents' argument that cash in hand recorded in the books of account by the respondents-assessees, who are businessmen, has to be excluded from the scope of "assets" because cash in hand is a productive asset. We do not think this argument is tenable because there is no provision in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the assessees that cash in hand of businessmen should be treated as productive asset also is meaningless. Except narrating the recommendations of the Chelliah Committee, neither the Finance Minister in the Budget Speech, nor the Central Board of Direct Taxes in its circular, said anything for exclusion of cash in hand in excess of Rs. 50,000 held by individuals and HUFs from the "assets" for the purpose of Wealth-tax Act. 8. In the result, we allow all the Departmental appeals, reversing the orders of the Tribunal and by upholding the orders of the lower authorities holding that cash in hand in excess of Rs. 50,000 held by the individual assessees formed part of assets under section 2(ea)(vi) of the Act. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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