Law: Wealth Tax Act, 1957

Section: 27(1),5(l)(viii),35

Wealth tax-----Rectification of mistakes ---Exemption ---Jewellery---Wealth tax assessment completed excluding value of jewellery as falling under exemption ---Retrospective amendment to S.5(1)(viii) by Finance (No.2) Act, .1971, making jewellery liable to wealth tax ---Wealth Tax Officer entitled to rectify concluded assessment by U sorting to S.35 of Act---Indian Wealth Tax Act, 1957, Ss.5(1)(viii) & 35 ---Indian Finance (No.2) Act; 1971. Wealth tax assessments for the assessment years 1968-69 and 1969-70 were originally completed exempting the value of jewellery from the assessee's net wealth. Subsequent to the amendment made to section 5(1)(viii), of the Wealth Tax Act, 1957, by the Finance (No.2) Act, 1971, with retrospective effect from April 1, 1963, making jewellery liable to wealth tax; the Wealth Tax Officer invoking section 35 of the Act sought to rectify the assessments by including the value of jewellery in the net wealth of the assessee. The Tribunal held that the question was a debatable one as to whether the amending provision applied to a concluded assessment against which no further proceedings were pending on the date of the enactment of the amending provision and, therefore, section 35 had no application. On a reference- Held, Held, that the Wealth Tax Officer had powers to rectify the assessment by resorting to powers under section 35 of the Act. J. M. Bhatia, A. A. C. of W. T. v. J. M. Shah. (1985) 156 ITR 474 (SC) fol JUDGMENT ARIJIT PASAYAT, C.J.---These two reference applications invoke identical questions, pertaining to the assessment years 1968-69 and 1969-70, which have been referred under section 27(1) of the Wealth Tax Act, 1957 (for short "the Act"), by the Income-tax Appellate Tribunal Delhi Bench-E (for short "the Tribunal"), for the opinion of this Court: , "Whether, on the facts and in the circumst8nces of the case, the provisions of section 35 of the Wealth Tax Act can be invoked to rectify the original assessment and to include the value of the jewellery, thus, giving effect to the amendments effected in section 5(l)(viii) of the Wealth Tax Act, 1957 by the Finance (No.2) Act of 1971?" Since the answer to the question…

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