1999 PLP 955 (PTD)

SYED SHAH MOHAMMED QUADRI, J. This is an application under section 27(3) of the Wealth Tax Act, 1957 (for short "the Act"). The Revenue is the petitioner. It seeks of a direction to the Income-tax Appellate Tribunal to state the case and refer the following questions as questions of law to this Court for opinion: (1) Whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the orders of the Wealth Tax Officer passed for the assessment years 1976-77 to 1978-79 were bad in law for assessing the beneficiary's life interest in the jewellery mentioned in the first schedule of the trust deed under section 21(1) of the Wealth Tax Act, 1957? (2) Whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the right to wear the jewellery on ceremonial occasions was not an asset so as to be assessed under section 21(1) of the Wealth Tax Act, 1957, in the hands of the trust representing the beneficiary even after the retrospective amendment of section 5(1)(viii) of the Wealth Tax Act, 1957, by the Finance (No.2) Act, 1971?" For the assessment years 1976-77 to 1978-79, the Wealth Tax Officer valued the right to wear jewellery on ceremonial occasions, vesting in one of the grand-daughters of H.E.H. the Nizam, and accordingly assessed the same under section 21(1) of the Act. On appeal, the Commissioner of Wealth-Tax (Appeals) set aside the assessment. The Revenue preferred an appeal before the Income-tax Appellate Tribunal against the said order of the Commissioner of Wealth-tax (Appeals). The 'Tribunal, following the judgment of a Division Bench of this Court in R.C. No.67 of 1969 dated November 5, 1971, held that the right to wear jewellery, however, widely the expression might be interpreted, could not be considered to be "property" for the purpose of wealth-tax and thus, dismissed the appeal of the Revenue on November 30, 1989. The application of the petitioner under section 27(1) of the Act to refer the said questions to this Court, filed before the Tribunal was dismissed on April 25, 1990. On these facts, the petitioner has filed this petition. Learned junior standing counsel for the petitioner submits that an identical question has been referred to the Full Bench and, therefore, this case may also be referred to the Full Bench. Sri Murali Krishna, learned counsel for the respondent, submits that the question now sought to be referred, was not one of the questions referred to the Full Bench. He further contends that the question is also covered by the judgment of this Court in CWT v. Trustees of H.E.H. the Nizam's Wedding Gifts Trust (1995) 216 ITR 232 and, therefore, the petition is liable to be dismissed. We have perused the order relied upon by learned junior standing counsel for the Revenue in R.C. No.41 of 1989, dated February 23, 1995. It relates to the interpretation of the trust deed executed by H.E.H. the Nizam on March 21, 1963, viz. Sahebzadi Anwar Begum Trust. The present case arises out of the trust known as the Nizam's Wedding Gifts Trust for two grand-daughters dated September 4, 1951. A Division Bench of this Court, of which one of us was a member (Syed Shah Muhammad Quadri, J.) in CWT v. Trustees of H.E.H. the Nizam's Wedding Gifts Trust (1995) 216 ITR 232, declined to refer an identical question. That case related to the assessment years 1976-77 to 1980-81. Following the judgment in R.C. No.67 of 1969 dated November 5, 1971, in that case the Bench held as follows (page 234): "From the extract of the judgment of the High Court in R.C. No.67 of 1969, dated November 5, 1971, quoted by the Tribunal, we may note the following observation made by Justice O. Chinnappa Reddy, as he then was, speaking for the Bench. The learned Judge observed, "her interest in the jewels is limited to being allowed to wear them if the trustees do not withdraw them from her. To our minds, the interest appears to be of a permissive nature and cannot be called property, however, widely the expression may be interpreted. We, therefore, agree with the Tribunal that neither the interest of the Sahebzadi in the jewellery fund nor her interest in the shares fund is an asset within the meaning of the Wealth Tax Act. We are in entire agreement with the observation of the Bench. In view of the said observation, the point is squarely covered by a binding judgment of this Court. Therefore, no referable question of law arises." In view of the above position, we opine that no referable question of law arises. Accordingly, the wealth tax case is dismissed. M.B.A./1882/FC Case dismissed.