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TMI Blog1975 (2) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... the net wealth of the assessee on the ground that the value of the house was less than Rs. 1,00,000 and the assessee was entitled to the exemption under section 5(1)(iv) of the Wealth-tax Act. Though the facts are not very clear as to how exactly the said house was treated as falling under section 4(1)(a) of the Wealth-tax Act, it is agreed in this reference by the learned counsel for both the parties that it will have to be treated as one falling under section 4(1)(a). The Wealth-tax Officer was of the view that, though the value of the house is to be included in the net wealth of the assessee under the provisions of section 4(1)(a), since the transfer in favour of the wife itself is not invalidated and the wife still holds the property as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs 1964-65 and 1965-66 is justified in law ? " Learned counsel for the assessee referred to the provisions of section 4(1)(a) and in particular the use of the words " as belonging to that individual " in that section as clearly indicating that Parliament intended to treat the property as that of the transferor for the purpose of the Wealth-tax Act and that, therefore, all the consequences of such treatment of the asset as belonging to the transferor would have to be given effect to. He also referred to the language used in section 5(1)(iv) and pointed out that even in that provision the same words " belonging to the assessee " are used. The learned counsel also drew our attention to the provisions of section 4 as it stood in the Bill stag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only for the purpose of including the value of the asset transferred in the net wealth of the transferor and cannot be extended further. He also argued that in interpreting the provisions of section 4(1)(a) we will have to keep in mind the scope and object of the provision itself as an anti-avoidance of tax measure and having regard to that object no exemption under section 5(1)(iv) would have been intended by Parliament to be extended to such transactions. He also pointed out that if Parliament had really intended that the benefit of section 5(1)(iv) should also be applicable to the transferor it would have provided that the property, in spite of the transfer, shall be deemed to be the property of the transferor in which case the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the properties out of the provisions of the Act. If the intended purpose of section 4(1) is to be achieved, the transferor shall not be allowed to be in a better position than what he would have been if he had not resorted to such a fraudulent transfer. We have used the expression " fraudulent transfer " not with the intention of restricting the scope of section 4(1) to only such fraudulent transfers, but in order to emphasize the need for a provision like section 4(1)(a). But we are not persuaded to hold that by this provision Parliament intended that the transferor should be put under a worse position or shall be subjected to more liability than what he would have been if the transfer had not taken place. There is nothing either in se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n or has not made it inapplicable for applying section 5(1)(iv). We are also unable to accept the argument of the learned counsel for the revenue that the words " as belonging to that individual " in section 4(1)(a) were used only for the purpose of avoiding any doubt or making it clear that the assets transferred are to be included only in the hands of the transferor and not in the hands of the transferee. We express no opinion as to whether the assets are liable to be included in the net wealth of the transferee as well. Suffice it for the purpose of this case to say that the words " as belonging to that individual " in section 4 appears to have been included, in our view, for the purpose of uniformity of expression which we find in the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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