9911796707
TMI Blog1978 (4) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... in Ceylon rupees was not in dispute. " The assessee submitted his wealth-tax return in respect of the assessment year 1967-68, corresponding to the year ending June 30,1966. He was assessed in the status of "individual" who is a citizen of India. He was resident and ordinarily resident. The valuation date was June 30, 1966. The assessee had certain wealth in Ceylon comprising of a co-ownership share in immovable properties as also some bank deposits and monies due from his brother. He had shown in the return his wealth in Ceylon at a figure of Rs. 70,604 in Ceylon currency. The WTO converted the Ceylon currency into Indian currency at the official exchange rate which came to Rs. 94,139 and this was included in the net wealth of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on date. As pointed out by the Supreme Court in Ahmed G. H. Ariff v. CWT [1970] 76 ITR 471, the phrase " if sold in the open market " found in s. 7(1) of the W.T. Act, 1957, does not contemplate actual sale or the actual state of the market but only enjoins that it should be assumed that there is an open market and that the property can be sold in such market and on that basis the value has to be found out. It is a hypothetical case which is contemplated and the tax officer must assume that there is an open market in which the asset can be sold. But whether the restriction on remittances would affect the realisable market value does not arise for consideration at all in this case and the assessee himself has valued his wealth in Ceylon at R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment, the value of the asset will have to be included because that section provides that where an assessee has been assessed in respect of assets located in a country outside India the laws of which prohibit or restrict the remittance of money to India, the WTO shall not treat the assessee as in default in respect of that part of the tax which is attributable to those assets and shall continue to treat the assessee as not in default in respect of that part of the tax until the prohibition or restriction of remittance. is removed. We now proceed to consider the second part of the contention of the learned counsel for the assessee. In the case of foreign wealth computed in terms of foreign currency, it is necessary for working out the weal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal exchange value. Unless there is evidence to show which evidence has to be produced by the assessee that the real value is different from the official rate, the WTO would be justified in taking the official exchange rate for purposes of valuation. In fact, the Supreme Court in Annamalai Chettiar v. CIT [1965] 56 ITR 109 accepted the principle of adopting the official exchange rate in the absence of any other basis available. This decision is sought to be distinguished on the ground that it was a decision under the I.T. Act. The learned judges of the Supreme Court did not rely on any particular provision of the I.T. Act; on general principles it was held that where property is purchased and sold in essentially different currencies, though ..... X X X X Extracts X X X X X X X X Extracts X X X X
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