Law: Wealth Tax Act, (XV of 1963)

Section: 2(e),2(m)

Wealth-tax Act, 1963 -Sections 2(e), 2(m) --Asset -Goodwill -Whether an asset -Held no -- Net wealth -Debt owed -Sums payable as advance-tax under the Income-tax Act -Whether debt owed and admissible deduction in determining the net wealth -Held yes -Assets -does not include goodwill --'Net wealth' does not include 'advance tax' being tax liability Asset -Net Wealth -Tax Liability -Tax liability -Amount payable for advance taxes -A debt owed within meaning of Section 2(m) -Deduction cannot be refused against total wealth - "Goodwill" -Not an asset within meaning of Section 2(c) -'Assets' does not include goodwill -"Net wealth' does include tax being tax liability -Words and phrases -Asset -Net wealth -Tax Liability -Change in Law -- ORDER The order was passed by M. T. SIDDIQUI, President.-This wealth-tax appeal questions the Wealth tax Officer's action in including a sum of Rs. 36,503 by way of goodwill and his refusal to deduct an amount of Rs. 4,030 payable for advance taxes. So far as the second issue is concerned the Tribunal has repeatedly held that a tax liability which is ascertainable is a debt owed within the meaning of Section 2(m) of the Wealth-tax Act. Following that decision we must therefore direct the Income-tax Officer to allow this as deduction against the total wealth of the appellant. 2. However, so far as the inclusion of the goodwill is concerned we find that within the meaning of Section 2(e) it is an asset as this provision defines 'asset' to include property of several descriptions, movable and immovable and does not exclude goodwill therefrom. It is for this reason that the Tribunal vide its order AC/70 of 1965-66 dated 12th December, 1971 held that goodwill was an…

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