Law: Wealth Tax Act, 1957

Section: 27(1),21(4), ScheduleI,3

Law: Income Tax Act, 1961

Section: 164

Wealth tax--- ----Representative assessee---Trust where shares of beneficiaries are not determinate---Effect of Ss.3 & 21(4)---Law applicable---Net wealth of such trust below statutory limit for charge of tax---Trust is not liable to tax--­Amendments made in S.21(4) have not changed the law---Indian Wealth Tax Act, 1957, Ss.3 & 21(4). According to the provisions of section 3 of the Wealth Tax Act, 1957 read with Schedule I created thereunder, in the case of an individual, wealth tax was not payable where the net wealth did not exceed Rs.1 lakh, which was later on raised to Rs.1,50,000. The words "no wealth tax shall be payable" in the proviso to Schedule I, Part I, clearly indicate that an individual was exempted from wealth tax where his net wealth did not exceed the prescribed exemption limit. Under subsection (4) of section 21 wealth tax is to be levied upon and recovered from the representative assessee concerned in the like manner and to the same extent as it would be leviable upon and recoverable from an individual, who is a citizen of India and a resident it India for the purposes of the Act. The words "for the purposes of this Act" would also include the provisions of section 21(4) of the Act. Therefore, though a representative assessee who holds the assets on behalf of the beneficiaries whose shares are indeterminate or unknown, is required to be assessed as an individual, the provision makes it clear that, that should be done in the same manner and to the same extent as the levy and recovery could be made from an individual. It, therefore, follows that if any individual is not liable to pay the wealth tax and the wealth tax is not recoverable from him, then to that extent it could also not be recovered from such representative assessee who is required to be assessed as an individual. After indicating the extent of liability of the representative assessee, the said provision proceeds to prescribe a higher rate of wealth tax to be paid by such representative assessee by providing that the wealth tax should be levied upon and recovered at the rate specified in Part I of Schedule I or at the rate of 3 percent whichever course would be more…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492