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TMI Blog1992 (6) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... e under section 2(m)(iii) of the Wealth-tax Act, 1957, and would, therefore, be deductible in computing the net wealth of the assessee ? " The facts which are admitted and/or found by the Tribunal are as under : The assessee is an individual and a partner of Messrs. Chatterjee and Polk. While determining the assessee's interest in the said partnership concern for the purposes of charge to wealth-tax, the Wealth-tax Officer did not grant any deduction in respect of liability to deduct tax at source and payable to the Central Government in accordance with section 192 of the Income-tax Act, 1961. The liability in respect of the unpaid amount towards taxes deducted at source under section 192 of the Income-tax Act, but not paid to the credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of section 2(m)(iii). It is, therefore, necessary to examine the words occurring in the said provision for the purpose of appreciating which of the two constructions in the said provision that are before us is correct. Section 2(m)(iii) reads as under: (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 - . . . . (iii) the amount of the tax, penalty or interest payable in consequence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date. The Assessing Officer's understanding of the provision is that the liability may be either in consequence of any order passed under the various Acts referred to in the provision or any liability arising in pursuance of any such Act. According to him, the linkage of the expression " or in pursuance of this Act or any law relating to taxation of income or profits, etc. ", is not with the participle " passed " following the word " any order " but with the adjective " payable ". Thus, he reads the provision to mean that any amount of tax, penalty or interest payable in pursuance of any law relating to taxation of income or profits, etc., besides any such amount payable in consequence of any order passed under any such law, is also embr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... automatic statutory liability to deduct tax from the salary disbursed to an employee. It is not the case that the liability arises only upon an order being passed by any of the income-tax authorities. The liability is not dependent upon Any specific order but is an automatic liability arising from the general mandate of the provisions of law itself. Thus, the liability of an assessee as an employer to deduct the tax from the salaries payable to his employees and to pay to the Central Government the tax so deducted does not arise as a result of any order passed under the Income-tax Act, 1961. Accordingly, section 2(m)(iii) has no application to such liabilities. It may be reasonably argued that the object of sub-clause (iii) of clause (m) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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