2001 PTD 1213 (PLP)

The assessee‑Hindu undivided family filed a declaration with the original wealth tax return that no member of the Hindu undivided family had wealth of Rs. 1,00,000 in order that the lower rate may be applied to the assessment of the Hindu undivided family. As it transpired that in income‑tax proceedings it was found that the smaller Hindu undivided family did have assessable wealth the assessing authority reopened the assessment. The Tribunal held that the reassessment proceedings were not valid. On a reference: Held, that the finding of the High Court under the Income‑tax Act was that the Karta of the smaller Hindu undivided family was also a member of the larger Hindu undivided family and had a share therein. The Court further held that whatever be the capacity in which the member of the Hindu undivided family has the income, if that income exceeds the amount specified in the Finance Act the higher rate would apply. The reasoning of the judgment applied with equal force to the provisions of the Wealth Tax Act, which also contained similar language, and hence, the reopening of the assessment was justified. S.S. Renganathan Chettiar v. CIT T. C. No. 419 of 1982 ref. C.V. Rajan for the Commissioner. P.P.S. Janarthana Raja for the Assessee. R. JAYASIMHA BABU, J.‑‑‑It was contended for the respondent that the reopening of the wealth tax assessment was unwarranted as the declaration filed alongwith the original return to the effect that no member of the Hindu undivided family had wealth of Rs. 1,00,000, was based upon the assessee's declaration in terms of the mandate contained in the Act. We do not find any substance in such a contention. As the Assessing Officer has rightly stated, he had been misguided by the statement made by the assessee that no member of the Hindu undivided family had wealth of Rs. 1,00,

000. What the Assessing Officer was required to do was to make sure that the Hindu undivided family did not have any member, with wealth of Rs. 1,00,000 or more, to order that the lower rate may be applied to the assessment of that Hindu undivided family. As it transpires that the smaller‑Hindu undivided family did have assessable wealth the assessing authority was justified in reopening the assessment, As to who is a member of the Hindu undivided family for the purpose of determining the appropriate rate of tax was considered by this Court in. T.C. No.419 of 1982 (S.S. Renganathan Chettiar v. CIT) decided on October 19, 1995. That case was one which arose under the Income‑tax Act. This Court held that the Karta of the smaller‑Hindu undivided family is also a member of the larger‑Hindu undivided family, and has a share therein. The Court further held that whatever be the capacity in which, the member of the Hindu undivided family has the income, if ‑that income exceeds the amount specified in the Finance Act, the higher rate would apply. The reasoning in that judgment would apply with equal force to the provisions of the Wealth Tax Act which also contains similar language. The Tribunal was, therefore,. in error in holding that the reopening of the assessment was without jurisdiction. e question referred to us, viz., as to whether the Tribunal was right in law in holding that the provisions of section 17(l)(a) of the Wealth Tax Act, 1957, are not attracted to the case of the assessee in respect of his wealth as on the valuation, dated February 5, 1975, is answered against the assessee and in favour of the Revenue. In the circumstances. there will be no order as to costs. Counsel, submits that the matter may be sent back to the Tribunal to consider the matter on the merits. We do not see any useful purpose in adopting such a course. The law has been declared by this Court in the decision referred to above. We have in this order held that the reasoning adopted in that decision is applicable with equal force to the relevant provision of the Wealth Tax Act. The facts, are not in dispute, at all. Having regard to these circumstances, we do not feel that it is worthwhile to ask the Tribunal to once again redo the same exercise. M. B. A./456/FC Only accordingly.