Law:

Section:

Section 27, read with section 7 of the Wealth-tax Act, 1957 - Reference - Academic question - Tribunal held that valuation of unquoted shares of company held by assessee should be valued on yield basis as against valuation of shares in accordance with rule 1D - Whether in view of earlier decision in a similar case in favour of assessee, question sought to be referred was academic - Held, on facts, yes FACTS For the relevant assessment year, the WTO valued the unquoted shares held by the assessee in accordance with rule 1D of the Wealth-tax Rules, 1957. On appeal, the Commissioner (Appeals) directed valuation of the shares on yield basis. On appeal by the revenue, the Tribunal not only upheld the order of the Commissioner (Appeals), but also rejected the application made under section 27(1). On an application under section 27(3) the revenue contended that (i ) the decision of this Court in the assessee's own case made earlier in Sharbati Devi Jhalani v. CWT [1986] 159 ITR 549 had not been accepted by the department, and a special leave petition was pending in the Supreme Court and that (ii) even if the said decision was correct nevertheless it had not been correctly applied by the Tribunal because this Court never meant that rule 1D would not apply if the valuation date of the company whose shares were not quoted and the valuation date of the assessee did not coincide. HELD The decision in the aforesaid case clearly covered the present controversy and so the question sought to be raised was academic. Rule 1D will apply compulsorily if the valuation dates of the company and the assessee is the same. If the two dates are different, then the assessee can show to the WTO that on his valuation date, the value of the unquoted shares, arrived at by the yield method is the one which should be adopted. By saying that in such a case, namely, where the two dates are different, rule 1D is directory, what is meant is that if the assessee chooses not to take recourse to valuing the shares as per the yield method, then it is open to the WTO to apply rule 1D. In such a case, if the WTO proposed to invoke rule 1D, it would be open to the assessee either to accept it, in which…

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