Law: Wealth Tax Act, (XV of 1963)

Section: 27(1),7(1),7(2)

Law: Wealth Tax Rules, 1963

Section: 8(8),8(9)

(a) Wealth Tax Act (XV of 1963)-- ---S. 7(1)--Balance-sheet--Accounts maintained properly and regu­larly--Due weight to be given to value of assets of business mentioned in balance-sheet--Wealth Tax Officer, however, empowered to make necessary adjustments in figures if circumstance permit--Balance-sheet not sacrosanct--Accounting errors or mistakes found in balance-sheet could be duly corrected and adjusted. (b) Wealth Tax Act (XV of 1963)-- ---S. 7(1) & (2)--Application of section 7(1)(2)--Subs (1) & (2) of S . 7, comparison of. It is correct that section 7(1) of Wealth Tax Act, 1963 is of general application but it would be incorrect that it should be applied to all cases. Subsection (2) is in the nature of an exception to subsection (1) of section 7. If section 7(1) is applicable to all cases then subsection (2) will be completely redundant and nugatory. This is neither the intention of the Legislature nor such meaning can be attributed by any rule of interpretation of statutes. The Legislature has provided a fair treatment to assessees who maintain their account regularly. The treat­ment to cases where accounts have not been accepted is covered by section 7(1). (c) Wealth Tax Act (XV of 1963)-- ---S. 7(1) & (2)--Wealth Tax Rules, 1965, r. 8(8) & (9)--Valuation of closing stock principle of--Before rejecting assessee's valuation, it is necessary to ascertain on what basis same had been valued and then give finding how it had been under-valued--Mere statement that closing stock had been under-valued, not sufficient to meet requirement of law--Such finding having not been given, no addition, held, could be made under r. 8(9) in closing stock. Chainrup Sampatram v. C.I.T. (1963) 24 I T R 481 (S C); Minister of National Revenue v. Anacouda American; Brass Ltd. (1956) 30 I T R 84; C.I.T. v. Chari Ram 1949 I T R 1; Whimster & Co. v I T 12 T C 813 and Hughes v B . C . Utting & Co. Ltd. 1940 I T R Suppl. 57 ref. JUDGMENT SALEEM AKHTAR, J.--This judgment will dispose of the following cases relating to assessment years 1966-67 and 1967-68: W. T. C. 567/72, 570/72, 571/72. 577/72. 578/72. X79/72. 583/72, 584/72, 601/72, 602/72, 606/72, 607/72,…

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