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TMI Blog1967 (11) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... essee is an ex-jagirdar of the former Gwalior State. His jagir estate was abolished by the Madhya Bharat Abolition of Jagirs Act, 1951 (hereinafter referred to as the Jagirs Act). The jagir stood resumed as from 4th December, 1952, on which date a notification under section 3 of the Jagirs Act was published for the resumption of all jagir lands in the quondam State of Gwalior. On the resumption of his jagir the assessee became entitled to receive compensation under section 8(1) of the Jagirs Act as determined in accordance with the principles laid down in the Schedule to that Act. The compensation amount became payable to the assessee with interest at a certain rate from the date of resumption till the date of payment. Section 15 of the Jagirs Act provided that the amount of compensation would be paid in maximum ten annual instalments. When the wealth-tax assessment for the assessment years in question were first made, the Wealth-tax Officer did not include in the computation of the assessee's net wealth on the relevant valuation date of each assessment year, the amount of compensation instalments which had not become due on the valuation date. Subsequently, he noticed a decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dishsingh of Rewa. Coming to the second question placed before us, it is first necessary to refer to the relevant provisions of the Wealth-tax Act. Section 3 is the charging section. It is in the following terms : " 3. Charge of wealth-tax.-Subject to the other provisions contained in this Act, there shall be charged for every assessment year commencing on and from the first day of April, 1957, a tax (hereinafter referred to as wealth tax) in respect of the net wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in the Schedule." " Net wealth " has been defined in section 2(m) thus : " (m) 'net wealth' means the amount by which the aggregate value computed in accordance with the provisions of this Act of all the assets, wherever located, belonging to the assessee on the valuation date, including assets required to be included in his net wealth as on that date under this Act, is in excess of the aggregate value of all the debts owed by the assessee on the valuation date other than--- (i) debts which under section 6 are not to be taken into account ; (ii) debts which are secured on, or which h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " show that for including an asset in the net wealth of the assessee it is not necessary that the asset must be with him. It may be located anywhere, but it must be long to the assessee on the valuation date. The words " belonging to " are used in contradistinction to " assets " which do not belong to the assessee but which belong to others and which are held by the assessee. The definition of " assets " as given in section 2(e) is wide enough. It includes property of every description, movable or immovable. Now, a " debt " owed to an assessee on the valuation date is clearly his asset. A debt is an obligation to pay a liquidated or certain sum of money. If it is present, it is existent or now due and owing. If it is future, it is existent but accruing or payable in the future. Both present and future debts are existing debts and can be attached and assigned and are, therefore, clearly assets. A debt which is payable in future by reason of a present obligation does not cease to be an asset belonging to the person to whom the debt is owed merely because that person has no immediate right to call for the money. These principles are well settled (see Syud Tuffuzzool Hossein Khan v. Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jagir lands became entitled to receive compensation at seven times his net income determined in accordance with Schedule I to the Act. Section 8 ran thus : " 8. Duty to Pay compensation.---(1) Subject to the other provisions of this Act, the Government shall be liable to pay to every jagirdar whose jagir lands his been resumed under section 3, such compensation as shall be determined in accordance with the principles laid down in Schedule I. (2) Compensation payable under this section shall be due as from the date of resumption and shall carry simple interest at the rate of 2 1/2 per cent. per annum from that date up to the date of payment : Provided that no interest shall be payable on any amount of compensation which remains unpaid for any default of the jagirdar, his agent or his representative-in-interest. " Section 15(1) of the Jagirs Act said that " . . . after the amount of compensation payable to a jagirdar under section 8 is determined under clause (a) of section 13 and the amount deducted from it under section 14, the balance shall be payable in maximum ten annual instalments. " Sub-section (4) of section 15 provided for the discharge of the Government's liab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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