Law:

Section:

Section 2(e), read with section 2(m), of the Wealth-tax Act, 1957 - Asset - General - Assessment year 1976-77 - Whether intangible addition made in income-tax proceedings unless proved to have been spent on relevant valuation date could be treated as assets of assessee for purpose of wealth-tax assessment - Held, yes FACTS For the assessment year 1976-77, the assessee, an individual, was assessed by the WTO, who held that intangible addition made in assessments under the Income-tax Act, 1961, represented assets in the shape of cash and as the assessee had failed to explain that the amount was spent, the intangible additions were includible in the net wealth of the assessee. On second appeal, the Tribunal deleted that addition. On reference: HELD Following the decision in the case of CWT v. Mishrilal Jain [1986] 161 ITR 583 (Pat.), in the instant case, the intangible addition made in the income-tax proceeding could be treated as the assets of the assessee for the wealth-tax assessment in the light of the provisions of section 2(e ) and (m) CASEREFERRED TO CWT v. Mishrilal Jain [1986] 161 ITR 583(Pat.). K.K. Vidyarthi and S.K. Sharan for the Applicant. JUDGMENT 1. By this reference under section 27(1) of the Wealth-tax Act, 1957 ('the Act'), the Tribunal has referred the following question of law to this Court for its opinion: "Whether, on the facts and in the circumstances of the case, the intangible addition made in the income-tax proceedings could be treated as the assets of the assessee for the purpose of wealth-tax assessment in the light of the provisions of section 2(e) and (m) of the Wealth-tax Act, 1957?" 2. The material facts giving rise to this reference briefly are as follows: The assessee is an individual. While framing assessment of the assessee under the Act for the year 1976-77 the WTO held that intangible additions made in assessments under the Income-tax Act, 1961 represented assets in the shape of cash and as the assessee had failed…

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