Law:

Section:

(a) Wealth tax--- ----Return---Notice---Charitable trust---Trust having vast properties but claiming exemption---Trust has to file return---Notice can be issued to trust under S.14(2)---Indian Wealth Tax Act, 1957, S.14. (b) Wealth tax--- ----Assessment---Notice---Charitable trust---Wealth Tax Officer can consider nature of trust---Inquiry must be made every year to find out if funds are utilised for charitable purposes---Notices under S.16(2) were valid---Indian Wealth Tax Act, 1957, S.16. (c) Wealth tax-- ----Assessment---Stay petitions against assessments pending before High Court ---Assessee not given opportunity to be heard---Orders of Assessment for Assessment Years 1986-87 to 1988-89 were liable to be quashed and remitted to Wealth Tax Officer. Under the provisions of section 14(1) of the Wealth Tax Act, 1957, where a person holds net wealth assessable under the Act, but claims exemption under any of the provisions of the Act, he is bound to file a return. The words "assessable under the Act" could only refer to the quantum and value of the wealth. For instance, a person having very little property can assume for himself that he need not file a return. Even in such a case, the law gives the authority the power to invoke section 14(2). The opinion of the officer has to be honest and genuine. It should not be capricious or according to his whims and fancies. Beyond this, there is no restriction on the officer to issue a notice under section 14(2). When the Officer has a bona fide doubt about the nature of the properties or the correctness of the claim for exemption, he is free to issue a notice under section 14(2). Similarly, where facts have to be ascertained regarding the application of the funds of a trust or the diversion of the funds to purposes other than charitable or religious, it is always open to issue a notice under section 14(2). Consequently, it is open to the authority to call the assessee for an enquiry under section 16(2) of the Act and demand the production of the records, accounts and documents under section 16(4). ' Section 5 of the Wealth Tax Act says that wealth tax shall not be payable by an assessee in respect of the assets held by…

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