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TMI Blog1995 (7) TMI 111X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Finance Act, 1983 and that the Explanation to section 40(a)(iia) specifically excludes any tax chargeable with reference to the value of any particular asset of the business or profession. The CIT (Appeals) held that charging of wealth-tax on companies has been introduced by section 40 of the Finance Act, 1983 and by the mere fact that it was not charged under the Wealth-tax Act, 1957, it could not be said that it would not constitute wealth-tax as defined in the Explanation to section 40(a)(iia) of the Act. Aggrieved, the assessee is in appeal. 3. We have heard the ld. counsel for the assessee, Shri H.R. Kamdar, and the Id. Departmental Representative, Shri R.G. Sharma, and considered the rival submissions. Section 40 provides that " ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yed in a business or profession carried on by the assessee whether or not the debts of the business or profession are allowed as a deduction in computing the amount with reference to which such tax is chargeable. It, however, does not include any tax chargeable with reference to the value of any particular asset of the business or profession. 6. The assessee is a limited company. The companies were earlier exempted by section 13 of the Finance Act, 1960 from the levy of wealth-tax and thus there was no wealth-tax chargeable in respect of a company prior to the introduction of section 40 by the Finance Act, 1983 with effect from 1-4-1984. Sub-section (1) of section 40 of the Finance Act, 1983, which revived the levy, states that wealth-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s evident that revival of the levy of wealth-tax by this section is under the Wealth-tax Act, 1957. Therefore, we do not find any merit in the submission that the wealth-tax charged by virtue of section 40 of the Finance Act, 1983 would not be a wealth-tax under the Wealth-tax Act, 1957. It is also evident from sub-section (7) of section 40 that these provisions are to be construed as part and parcel of Wealth-tax Act. This sub-section (7) reads ' Subject to the provisions of sub-section (5), this section shall be construed as one with the Wealth-tax Act." Sub-section (5) states that for the purposes of levy of wealth-tax under the Wealth-tax Act, 1957, in pursuance of the provisions of this section-- (a) section 5 and clause (a) of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such charges is either under the laws in this country, i.e., the Wealth-tax Act or under the laws in force outside India. There is no warrant for this construction because the words upon which reliance has been placed are related to the tax chargeable under a law in force in any country outside India with reference to the value of the assets of or employed in a business or profession carried on by the assessee. The exclusion contemplated by the exception on which emphasis is placed is wholly unrelated to the scheme of the Wealth-tax Act, because wealth-tax under that Act is not chargeable with reference to the value of any particular asset of the business or profession but under section 3 the charge is in respect of the net wealth on the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Wealth-tax Act where though each asset comprised in the net wealth can be separately valued under section 7, nevertheless net wealth would be the amount by which the aggregate value of all those assets, exceed the aggregate value of debts owed by the assessee on the valuation date. Even otherwise, to read the exception ' but does not include any tax chargeable with reference to the value of any particular asset of the business or profession ' with the first part of the explanation ' wealth-tax ' means wealth-tax chargeable under the Wealth-tax Act, Act, 1957, would not grammatically make any sense. These two, read together, would make the following sentence ' wealth tax ' means wealth-tax chargeable under the Wealth-tax Act, 1957, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Wealth-tax Act, i.e., the aggregate value of all the assets belonging to the assessee on the valuation date which is in excess of the aggregate value of all the debts owed by the assessee on the valuation date. We, however, do not find any force in the contention of the assessee as we do not see any material difference in the scheme. For the purpose of section 40 of the Finance Act, 1983, ' net wealth ' is defined in sub-section (2) which reads as under : " (2) For the purposes of sub-section (1), the net wealth of a company shall be the amount by which the aggregate value of all the assets referred to in sub-section (3), wherever located, belonging to the company on the valuation date is in excess of the aggregate value of all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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