1969 (11) TMI 3

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..... o the munim of Messrs. Bhagwati Prasad and Company that capital amounting to Rs. 1,07,892 invested by the assessee in the firm should be divided amongst the members of the Hindu undivided family. In accordance with that direction, the munim made entries after 8 p.m. When the Wealth-tax Officer took up assessment of wealth-tax against the Hindu undivided family, the question arose whether the sum of Rs. 1,07,892 ought to be included in the net wealth of the assessee. The assessee contended that, in view of the distribution of the amount amongst members of the assessee family on the valuation date, that amount ought to be excluded from the net wealth of the assessee. This contention was not accepted by the Wealth-tax Officer. He held that the .....

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..... ding of fact recorded by the Appellate Assistant Commissioner. We may, therefore, proceed on the footing that some time between 8 p.m. and midnight the sum of Rs. 1,07,892 was distributed among members of the assessee family on November 8, 1958. The learned Advocate-General pointed out that the assessee was the owner of the sum of money for the greater part of the valuation date. On the other hand, Mr. Gulati appearing for the assessee, pointed out that the assessee was not the owner of the money during the last moment of the day corresponding to the valuation date. A similar case came before this court in Dwarka Nath v. Commissoner of Wealth-tax. In that case a Hindu undivided family had invested 3 lakhs of rupees in a firm. On the va .....

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..... , it is necessary to give a modified meaning to the expression " on the corresponding valuation date ". A reasonable interpretation of the phrase " on the corresponding valuation date " would be " throughout the day corresponding to the valuation date ". Such an interpretation would avoid double taxation. The learned Advocate-General pointed out that upon this interpretation the item would escape assessment to wealth-tax in the hands of the transferor as well as the transferee. That may be so. But, as pointed out by Desai C.J., any ambiguity in a taxing statute must be resolved in favour of the taxpayer, and no tax liability should be attached unless the law is clear. There is no indication in the Wealth-tax Act, 1957, that Parliament inten .....

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