1997 PLP 440 (PTD)
COMMISSIONER OF WEALTH TAX Versus V. PUGALAGIRI
| Citation | 1997 PLP 440 (PTD) |
| Forum / Court | 212 I T R 156 |
| Bench Members | Ratnam and Somasundaram, JJ |
| Parties | COMMISSIONER OF WEALTH TAX Versus V. PUGALAGIRI |
| Primary Law | Wealth tax |
Q1: What are the key laws and sections cited in 1997 PLP 440 (PTD)?
This judgment primarily cites: Wealth tax as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 1997 PLP 440 (PTD)?
The case was heard and decided by the 212 I T R 156 bench comprising: Ratnam and Somasundaram, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 1997 PLP 440 (PTD) (COMMISSIONER OF WEALTH TAX Versus V. PUGALAGIRI). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- C.V. Rajan for Petitioner.
- Meenakshi Sundaram for Respondent.
Headnotes / Summary
Properties bequeathed to assessee with life interest to assessee's mother
Tribunal right in taking discounted value of property
No question of law arises Indian Wealth-tax Act, 1957, S.
27. Under the will of the father of the assessee, his mother had a life interest in certain properties and while computing the value of the interest of the remainderman, viz., the assessee, he took the stand that the value of the remainderman's interest should be arrived at a discounted value after taking into account the mortality of the life interest holder and also the present discounted value of the death benefit. While the assessing authority did not accept this, the appellate authority upheld the method of valuation of the interest of the remainderman as put forward by the assessee. The Tribunal also accepted the valuation so made. On an application to direct reference: Held, dismissing the application, that the value of the interest of the remainderman would be the present value of his right to receive the corpus of the property at an uncertain future date and such valuation had to be done on an actuarial basis and taking the further value of the asset to be received at a later date, its present value had to be discounted. That precisely had been done by the appellate authority and was also upheld by the Tribunal. No question of law arose from the order of the Tribunal. CWT v. Trustees of H.E.H. Nizam's Family (Remainder Wealth) Trust (1977) 108 ITR 555 (SC) applied.
Judgment & Decree
RATNAM, J.
In these tax case petitions under section 27(3) of the
Wealth Tax Act, 1957, the Revenue seeks a direction to the Tribunal to refer the following common question of law for the opinion-of this Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in refusing to restore the valuation made by the Assessing Officer but confirming the order of the Deputy Commissioner (Appeals), despite the fact that the Deputy Commissioner (Appeals) had overlooked the fact that, in the light of the will, dated September 16, 1970, left by Dr. Vadamalyan, the interest of the assessee in the two properties under consideration was ownership of the properties subject only to the right of residence for his mother till her death?" Under the will, dated September 16, 1970, of the father of the assessee, his mother had a life interest in certain properties and while computing the value of the interest of the remainderman, viz., the assessee, he took the stand that the value of the remainderman's interest should be arrived at a discounted value after taking into account the mortality of the life interest holder and also the present discounted value of the death benefit. While the assessing authority did not accept this, the appellate authority, applying the observation of the Supreme Court in CWT v. Trustees of H.E.H. Nizam's Family (Remainder Wealth) Trust (1977) 108 ITR 555, upheld the method of valuation of the interest of the remainderman as put forward by the assessee. The Tribunal also accepted the valuation so made. We have carefully considered the order of the Tribunal and we find that the course adopted by the appellate authority as well as by the Tribunal, in the absence of specific rules in regard to the valuation of the interest of the remainderman, is quite correct and is also fully supported by the observation of the Supreme Court in the decision referred to earlier. It has been pointed out by the Supreme Court that the value of the remainderman would be the present value of his right to receive the corpus of the property at an uncertain future date and such valuation should be done on an actuarial basis and that taking the future value of the asset to be received at a later date, its present value had to be discounted. That precisely had been done by the appellate authority and was also upheld by the Tribunal. Ultimately, the whole question revolves round the method of the valuation to be adopted, in the absence of any specific rule in that regard. We are, therefore, of the view that no referable question of law as such can be said to arise out of the order of the Tribunal. These tax case petitions are dismissed. No costs. M.B.A./1107/FC ??????????????????????????????????????????????????????????????????? Petitions dismissed.