Law: Wealth Tax Act, 1957

Section: 27(3),16A

(a) Wealth Tax--- ----Valuation of assets---Valuation of unquoated shares---Rule 1-D mandatory---Wealth Tax Rules, 1957, R.1D. (b) Wealth Tax---- -----Valuation of assets---Valuation of Coffee Estate---Circular of CBDT---Not binding on assessee---Assessee submitting report of registered valuer--­Circular as well as report of registered valuer must be taken into consideration---Tribunal if it considers fit could refer valuation to Valuation Officer---Matter remanded---Wealth Tax Act, 1957---CBDT Circular No.357 dated 26-3-1983. Held, (i) that rule 1-D of the Wealth Tax Rules, 1957, was mandatory. Therefore, the value of the unquoted shares of a company had to be made following the break-up method; CWT v. India Exchange Traders' Association (1992) 197 ITR 356 (Cal.) fol. (ii) that the Central Board of Direct Taxes circular dealing with valuation of coffee estates was not binding on the assessee. In this case, the assessee asked the Wealth Tax Officer to accept the valuation made by the Registered Valuer, whereas the Wealth Tax Officer had valued the interest of the assessee in the coffee estate on the basis of the circular of the Central Board of Direct Taxes. Hence, the matter should be remitted to the Tribunal for fresh determination of the valuation of the coffee estate taking into account the circular of the Board, dated March 26, 1982, as well as the valuation made by the Registered Valuer and all other relevant factors for determination of such valuation. The Tribunal, if it considers it fit and proper, could refer the matter to the Valuation Officer and thereupon decide the issue. CWT v. Balbhadradas Bangur (1984) 148 ITR 149 (Cal.); Kibe (M.V.) v. CWT (1987) 168 ITR 82 (MP) and Raja Baldeodas Birla Santatikosh v. CWT (1991) 189 ITR 613 (Cal.) ref. JUDGMENT AJIT K.SENGUPTA, J: --In this reference under section 27(3) of the Wealth Tax Act, .1957, the following questions of law have been referred to this Court for the assessment year 1981-82: "(1) Whether, on the facts and in the circumstances of the case, 'the Tribunal was justified in directing the Assessing Officer to value the unquoted shares by applying the yield method? (2) Whether, on the facts and in…

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