9911796707
TMI Blog2017 (11) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Deputy Commissioner of Wealth Tax, Central Circle 2(2), Bangalore making an addition of Rs. 1,77,46,755/-recorded in books of accounts on account of cash in excess of Rs. 50,000/- is opposed to law, equity and natural justice and against facts and circumstances of the case. b) The order passed by the learned Deputy Commissioner of Wealth Tax, Central Circle 2(2), and Bangalore is arbitrary without appreciating the cash is held in excess of Rs. 50,000/- is related to business productive current asset used for business purposes. 3. The appellant relies on the following important judgments of Hon'ble Income Tax Appellant Tribunals of Cochin and Kolkata wherein it has been categorically held that the cash held for business would not form part of the net wealth for the purpose of levy of wealth tax. a) In AA Salam Vs ACWT (13 SOT 446), the Cochin Bench of the Hon'ble Tribunal had interpreted that cash held in business even by the individuals and HUFs and duly recorded in the books of the assessee could not form part of the net wealth liable to wealth tax. The Hon'ble Tribunal quoted the Finance Minister's speech while moving the finance bill, 1992 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case of other persons any amount not recorded in the books of account is an asset chargeable for the purpose of the Act. In the instant case, since the assessee is an individual, cash in hand in excess of Rs. 50,000 is to be treated as asset and added to the net wealth of the assessee. 3. Aggrieved, the assessee has preferred an appeal before the CIT(Appeals), but did not find favour with him. Now the assessee is before us and raised similar arguments as raised before the CIT(Appeals). 4. The ld. counsel for the assessee contended that assessee was doing his business and maintained books of account. Since the cash in hand is available in the books of account for business purpose, it is a productive asset, therefore cannot be chargeable to tax. 5. The ld. DR, besides placing heavy reliance upon the judgment of the Hon'ble Kerala High Court in the case of CWT v. Smt K.R. Ushasree, 332 ITR 75 (Ker), invited our attention that the assessee has furnished the balance sheet of personal account and not of the so-called business carried on by him. Before the AO, he has not made out a case that cash was available in his account. It was further contended that the provisions of section 2( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said judgment in which Their Lordships have categorically held that there is nothing that stops the assessee from utilizing the cash in hand which may be the business asset on the valuation date for any non-productive purpose on the next day. Therefore the argument of assessee that cash in hand of businessmen should be treated as productive asset also is meaningless. The relevant observations of the Hon'ble High Court of Kerala are extracted hereunder for the sake of reference:- "3. The contention of the appellants is that cash in hand excluded from "assets" for individual assessees is only Rs. 50,000 and any amount held as cash in hand in excess of Rs. 50,000 is an asset falling under the above definition clause. The contention of the assessees is that so far as businessmen are concerned, cash in hand is a business asset 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; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany 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-intrade. Further it will include motor cars other than those used in the business of running them on hire or which form part of stock-in-trade ; jewellery, bullion, furniture utensils or any other articles made wholly or partly of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals (other than those used as stock-in trade) ; yachts and boats and aircrafts (other than those used for commercial purposes), cash in hand in excess of Rs. 50,000 of individuals or HUFs and in case of any other person any amount not recorded in the books of account and urban land." The assessees have heavily relied on the Minister's Speech and the above circular of the Central Board of Direct Taxes to contend that cash in hand of businessmen being productive asset recorded in the books of account, including the balance-sheet, does not fall within the definition of "asset". They have relied on the above referred decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... namely, companies, is concerned, the distinction is between the amount recorded in the books of account and amounts not recorded in the books of account. In the case of companies, what is brought to the definition of "asset" is the amount not recorded in the books of account, which obviously means that cash in hand recorded in the books of account is outside the scope of "asset". We notice 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. 5. 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 the definition clause or in any other section of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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