Law: Wealth Tax Act, 1957

Section: 3,2(h),4

Law: Wealth Tax Rules, 1957

Section: 2

Law: Income Tax Act, 1922

Section: 3

Wealth tax--- ---- Charge of tax only on individual, HUF and company---Club registered under the Karnataka Societies Registration Act, 1960---Is an association of persons and not an individual---Not an assessable entity---Nor liable to wealth tax---Indian Wealth Tax Act, 1957, S.3.--[Coimbatore Club v. WTO (1985) 153 ITR 172 (Mad.) dissented from]. The term "individual" in section 3 of the Wealth Tax Act, 1957, would not bring within its compass an "association of persons" or "body of individuals" such as a club registered under the provisions of the Societies Registration Act, 1860. Therefore. the assessee, an association of members running a club and registered under the provisions of the Karnataka Societies Registration Act, 1960, is not an "individual" falling within the scope of section 3 of the Act and hence not an assessable entity under the Wealth Tax Act, 1957. Orient Club v. CWT (1982) 136 ITR 697 (Bom.); Willingdon Sports Club v. C.B. Patil (1982) 137 ITR 83 (Bom.) and Royal Calcutta Turf Club v. WTO (1984) 148 TTR 790 (Cal.) fol. Coimbatore Club v. WTO (1985)153 ITR 172 (Mad.) dissented from. Orient Club v. WTO (1980) 123 ITR 395 (Guj.) and Sarjerao Appasheb Shitole v. WTO (1964) 52 ITR 372 (Kar.) ref. JUDGMENT K. SHIVASHANKAR BHAT, J: --Under the provisions of the Wealth Tax Act, 1957, the following question has been referred for our consideration: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the CIT (Appeals) was perfectly justified in cancelling the assessment made on the assessee under the Wealth Tax Act for the years 1976-77 and 1977-78 by holding that the assessee. is not an assessable entity under the Wealth Tax Act?" The assessee is an association of members running a club; it is registered under the provisions of the Karnataka Societies Registration Act, 1960; the managing committee, for the time being, holds the assets of the ...' assessee under trust, but the assets are not transferable. The question is,' whether this assessee is an "individual" falling within the scope of section 3 of the Wealth Tax Act ("the Act" for short). The Appellate Tribunal held that the…

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