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TMI Blog1986 (4) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... led to exemption of Rs. 1,50,000 under section 5(1)(xxiii) of the Wealth-tax Act 1957, on shares of Indian companies held by it, in respect of the years under consideration ? " The assessee, M/s. Bangur Charitable Trust, Didwana, claimed exemption of Rs. 1,50,000 under section 5(1)(xxiii) of the Wealth-tax Act, 1957 (No. XXVII of 1957) (for short " the Act "), on the shares of various companies held by it. The assessment years under consideration are 1973-74, 1974-75 and 1975-76. The Wealth-tax Officer, Central Circle, Jodhpur, held that the exemption is not allowable because it is admissible only to individuals and Hindu undivided families and not to a trust. Aggrieved, the assessee filed appeals under section 16(3) of the Act. The Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to as wealth-tax) in respect of the net wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in the Schedule." Section 4 deals with the assets which are included in the assets of the assessee under the special circumstances mentioned therein. Section 5 gives the list of various assets which are exempt from the levy of wealthtax, the amount of exemption and the conditions under which these assets are exempted from the levy of wealth-tax. Material part of section 5 for the present purpose is as follows : " 5. (1) Exemptions in respect of certain assets.-Subject to the provisions of sub-section (1A), wealth-tax shall not be payable by an assessee in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s an individual or a Hindu undivided family and holds shares in an Indian company other than the shares mentioned in clause (xx) or (xxa), is entitled to exemption. Section 3, which is the charging section, shows that wealth-tax is payable by an individual, a Hindu undivided family and a company. Exemption under section 5(1)(xxiii) is available to an individual or a Hindu undivided family. Companies has been excluded. The view taken by the Tribunal is that the word " individual " mentioned in section 5(1)(xxiii) of the Act includes a charitable trust. It may be mentioned that in the whole of the Act, there is no prohibition that a charitable trust or, for that matter, a trust is not included in the word " individual " as used in section 5(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom wealthtax on the ground that an " association of persons " is not an entity mentioned in the charging section of the Wealth-tax Act, 1957. For coming to this conclusion, CIT v. Sodra Devi [1957] 32 ITR 615 (SC) and Suhashini Karuria's case [1962] 46 ITR 953 (Cal) were relied on. Whether the word " individual " includes trustees of a trust so as to be, an assessable unit came up for examination in connection with sections 3, 5(1)(i) and 21 of the Act before the Supreme Court in Trustees of Gordhandas Govindram Family Charity Trust v. CIT [1973] 88 ITR 47. Their Lordships were in agreement with the view taken in Suhashini's case [1962] 46 ITR 953 (Cal) and Abhay L. Khatau's case [1965] 57 ITR 202 (Bom) and held that the trustees of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " individual " within the meaning of section 5(1)(xxiii) of the Act. The Tribunal was right when it affirmed the order of the Appellate Assistant Commissioner, who held that the assessee-trust is deemed to be an individual and is thus entitled to claim exemption. We agree with the view taken by the Tribunal that the assessee-trust shall be deemed to be an individual and is entitled to exemption under section 5(1)(xxiii) of the Act. We, therefore, answer the question referred by the Tribunal in the affirmative, i.e., in favour of the assessee-trust and against the Revenue. In the circumstances of the case, we pass no order as to costs of this reference. Let a copy of this order be sent to the Tribunal as required by section 27(3) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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