9911796707
TMI Blog1993 (11) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... erred the following questions of law arising out of its order dated February 10, 1982, in respect of the assessment years 1974-75 and 1975-76, under section 27(1) of the Wealth-tax Act, 1957. "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in upholding that the order of the Commissioner of Wealth-Tax (Appeals) holding that the Wealth-tax Officer should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cent. shares. The said firm had to realise a sum of Rs. 2,50,000 from Messrs. Radha Krishna Trading Company (P.) Ltd., and Rs. 59,000 from Messrs. S. Vappa, Raichur. Having no hope to realise the said debts, the value of the share of the assessee in the firm was worked out by reducing the said debts which were considered as bad debts. The claim of the firm in respect of the amount of Rs. 59,000 wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingent liability was not reduced. In H. H. Shri Natwarsinhji v. CWT [1993] 201 ITR 133, the Gujarat High Court has held that a debt which has become irrecoverable cannot be included in the net wealth and it is not necessary that it should be written off in the books of account. The subsequent events were also taken into consideration. We need not go into the question as to whether the subsequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Officer has to proceed on the basis of such valuation of the debt. There may be a case where the entire debt does not have any value because it could not be recovered or a dispute exists of the nature reducing its value to nil or for such like circumstances. The debt may have a reducing value as well besides the nil value and in accordance with the provisions of section 7 of the Wealth-tax Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . So far as the second question is concerned, the said question is covered by the decision of this court in Seth Mukund Dos Rathi v. CWT [1991] 188 ITR 518 and on the basis of the said judgment, it is held that the gratuity liability is an unascertained liability and, therefore, the same should not be deducted while determining the market value of the shares of Krishna Mills, Beawar. According ..... X X X X Extracts X X X X X X X X Extracts X X X X
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