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TMI Blog2004 (12) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 (hereinafter referred to as "the Act"), for opinion to this court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the amounts under the Compulsory Deposit Scheme (Income-tax Payers) Act, 1974, constituted an asset within the meaning of section 2(e) of the Wealth-tax Act and were includible in the net wealth of the assessee for assessment to wealth-tax?" In Wealth-tax Reference No. 127 of 1987 which relates to the assessment years 1979-80 and 1980-81 the Income-tax Appellate Tribunal, Delhi, has referred the following question of law under section 27(1) of the Wealth-tax Act, 1957 (hereinafter referred to as "the Act"), for opinion to this court: "Whether the Tribunal was right in holding that the amounts standing to the credit of the assessee in deposit account under the Compulsory Deposit Scheme (Income-tax Payers) Act, 1974, constituted an asset within the meaning of section 2(e) of the Wealth-tax Act and the same were includible in the net wealth of the assessee?" In Wealth-tax Reference No. 231 of 1987, which relates to the assessment years 1981-82 and 1982-83, the Income-tax Appellate Tribunal, Delhi, has referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Wealth-tax Reference No. 235 of 1987 which relates to the assessment years 1980-81 and 1982-83, the Income-tax Appellate Tribunal, Delhi, has referred the following question of law under section 27(1) of the Wealth-tax Act, 1957 (hereinafter referred to as "the Act"), for opinion to this court: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in law in holding that the amounts of Rs. 3,66,783 and Rs. 5,02,738 standing to the credit of the assessee in deposits under the Compulsory Deposit Scheme (Income-tax Payers) Act, 1974, were includible in his net wealth for the assessment years in question?" In Wealth-tax Reference No. 236 of 1987 which relates to the assessment years 1979-80, 1980-81,1983-84 and 1984-85 the Income-tax Appellate Tribunal, Delhi, has referred the following question of law under section 27(1) of the Wealth-tax Act, 1957 (hereinafter referred to as "the Act"), for opinion of this court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the amounts standing to the credit of the assessee in bank account in respect of deposits made under the Compulsory Deposit S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s: "1. An annual allowance or income also, the right to receive such an allowance or the duty of paying it; 2. The return from an investment of capital, with interest, in a series of yearly payments; especially, an agreed amount paid by an insurance company at stated intervals, usually monthly, in consideration of either a single premium or premiums paid over a period of years." He referred to a decision of the apex court in the case of CWT v. H.H. Maharani Gayatri Devi of Jaipur [1971] 82 ITR 699, wherein the apex court has held that the question whether a particular income is an annuity or not does not depend on the amount received in a particular year. What has to be seen is what exactly was the intention of the settlor in creating the trust. Did he intend to give the assessee a pre-determined sum every year or did he intend to give her an aliquot share in the income of a fund? On that question, there can be only one answer and that is that he intended to give her an aliquot share in the income of the trust fund. An income cannot be an annuity in one year and an aliquot share in another year. It cannot change its character year after year. He has further referred to a de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. CWT [1998] 232 ITR 921 (Delhi); (vi) CWT v. L.G. Balakrishnan [2001] 249 ITR 578 (Mad); (vii) CWT v. Dalchand Jain [1996] 85 Taxman 453 (MP); and (viii) V. M. Rao v. CWT [1997] 228 ITR 789 (Mad). Having heard learned counsel for the parties, we find that under the 1974 Act, section 3 enjoins upon every person who is assessable under the Income-tax Act in respect of the total income of an individual or a Hindu undivided family or a trustee to make compulsory deposit at the specified rate in section 4 of the 1974 Act. The amount, the time-limit as also the rate of interest and its repayment had been specified. Section 7A of the 1974 Act, which was inserted by the Finance (No. 2) Act of 1980 with effect from April 1, 1975 had granted exemption under section 5 of the Act by treating the amount of compulsory deposit to be a deposit with a banking company to which the Banking Regulation Act, 1949, applies. Thus, a deposit made under the 1974 Act is to be treated for all purposes as a deposit with a banking company and is to be reckoned with other bank deposits under section 5 of the Act. The word "assets" has been defined under section 2(e) of the Act. The definition, as i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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