Law: Wealth Tax Act, 1957

Section: 7(2)(a)

Wealth tax-Global valuation of assets-Deference between book value and written down value-Finality of book value-Right of assessee to adduce other materials to show proffer valuation --Duty of officer to consider such materials-Wealth Tax Act, 1957, S. 7(2)(a). Normally, if an assessee exhibits the book value in the balance sheet and does not show in it the written down value of the assets relevant for purposes of income-tax, the Wealth-Tax Officer, if there is nothing more, has to act on the balance-sheet and determine the value of the assets on that basis. It is only where proper materials are placed before the Wealth Tax Officer to establish circumstances which call for adjustment that he is obliged to consider the same. If in addition to the Wealth Tax Officer's attention being drawn to the written down value of assets for purposes of income-tax, other materials which would convince the officer brat adjustments ought to be made arc placed, he would not be at liberty to brash aside such material and still proceed on the basis of the book value of the assets shown in the balance-sheet. The claim of the assessee to deduct the difference between the book value of the assets as exhibited in its balance-sheet and the written down value was negatived by the departmental officers and the Tribunal on the ground that, as the global valuation was adopted, the balance sheet as on the valuation date should be taker as the basis and no adjustment could be made for any reason. The High Court, on a reference, held, that the Tribunal had proceeded on a wrong basis and the matter had to be disposed of by it afresh after giving an opportunity to the assessee to establish why the figures in the balance-sheet should not be adopted as the proper value. Commissioner of Wealth Tax v. Indian Standard Metal Co. Ltd. (1963) 49 I T R 832 ; Commissioner of Wealth Tax v. Tungabhadra Industries Ltd. (1966) 60 I T R 447 ; Kesora n Industries & Cotton Mills Ltd. v. Commissioner of Wealth Tax (1966) 59 I T R 767 (S C) ; Loyal Textile Mills Ltd. v. Commissioner of Wealth Tax(1968) 68 I T R 14 ; Setu Parvati Bayi (H. H.) v. Commissioner of Wealth Tax (1968) 69 I T R 864 (S C) and…