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TMI Blog1983 (5) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... e WTO included a sum of Rs. 20,000 as proportionate liability disallowed. The AAC gave an enhancement notice and brought to tax the entire amount of Rs. 84,234 holding that these debts being secured by shares exempt u/s 5 to the extent of Rs. 1,50,000, the provisions of s. 2(m)(ii) constrained such addition. The assessee has come up on appeal against the above. 2. The ld. counsel has taken us through the details of net wealth, exemption claimed, the details of the loans taken, etc. Sec. 2(m)(ii) does not talk of partly chargeable assets. There was no question, therefore, of proportionate disallowance. There was also no case for disallowing the entire amount as was done in the enhanced order of the AAC. Reference is made in this connectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Hindu undivided family;)." It is on the basis of s. 5(1)(xxiii) an exemption is sought and on the basis of s. 5(1A) that the limit of exemption is restricted to a sum of Rs. 1,50,000. There is no dispute about the facts insofar as the assessee is the holder of shares valued at Rs. 7,55,863 and has also taken the loans from Central Bank of India and Shri M.C. Thakore, relative to or partly secured on, in respect of the bank overdraft account on the shares. The details of the share-holdings included in the net wealth are as under: Name of the Company No. of shares Value per share Total . . . Rs. Shakti Insulated 3,790 178.50 6,76,515 Kohinoor 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the third item. He could as well exercise a right of exemption in respect Rs. 1,50,000 out of the third item only without touching the first two items. In other words, insofar as there is no disability for the assessee to exercise an option in respect of the particular asset for which exemption is claimed, the option must rest with him. We are guided to this conclusion by two important reasons. The first is whether an exemption under a tax statute should be claimed or not, should be left to the taxpayer. He cannot be compelled to avail of an exemption. If that be so, where an exemption to be claimed in respect of one particular item or other or none at all should also be within his option and discretion. Secondly, s. 5 r/w 5(1)(1A) lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hoose the particular sub-clause for which he claims the exemption. It is only a valid and lawful extension of this principle for him where he holds different assets coming under one or other sub-sections referred to in section 5(1)(1A) to choose among the assets so as to come under sub-clause (itself). Thus, in the present case, the assessee has shares in six companies noted above. Each share of a company would be a separate asset in his hands. In computing the net wealth, out of the overall value of Rs. 7,55,863, a deduction of Rs. 1,50,000 as lump sum is made to bring down the value of share taxable to Rs. 6,05,863. The liability of Rs. 84,239 could at best pertain to shares worth this or approximately this amount. The balance of shares a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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