Appellate tribunal may sustain a wealth-tax addition on a different legal basis if the disputed amount remains the subject of appeal.

Where the addition of Rs. 3 lakhs to net wealth was itself in issue, the Tribunal could sustain that addition on any legally permissible ground appearing from the assessment record. The article notes that the appellate power under section 24(5) of the Wealth-tax Act, 1957 is comparable to the broader appellate power recognised under section 33(4) of the Indian Income-tax Act, 1922, allowing the tribunal to uphold an assessment on a different legal basis without exceeding jurisdiction. On that reasoning, sustaining the addition as part of the cost of the building under construction, instead of as goodwill, was within power.

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Issues: Whether the Tribunal was justified in sustaining the addition of Rs. 3 lakhs to the assessee's net wealth on a ground different from that adopted by the Wealth-tax Officer and the first appellate authority, namely as part of the cost of the building under construction.

Analysis: The subject-matter of the appeal was the addition of Rs. 3 lakhs itself. Once that addition was under challenge, the Tribunal could sustain it on any legally permissible ground arising from the assessment record. The power under section 24(5) of the Wealth-tax Act, 1957 is analogous to the appellate power considered under section 33(4) of the Indian Income-tax Act, 1922, under which the appellate tribunal may grant relief or sustain an assessment on a different legal basis. Since the issue before the Tribunal was the inclusion of Rs. 3 lakhs in the net wealth, it did not exceed its jurisdiction by upholding the addition as cost of construction instead of goodwill.

Conclusion: The question was answered in the affirmative, and the Tribunal's view was upheld in favour of the Revenue and against the assessee.

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