Capital gains share valuation follows the higher connected wealth-tax value where the assessee's declaration is lower

For computation of capital gains, the assessee's valuation of shares was accepted where it was higher than the valuation reflected in connected wealth-tax proceedings, while the higher valuation from those proceedings had to be adopted where the assessee's declared value was lower. Applying that principle, the Appellate Assistant Commissioner correctly directed recomputation of capital gains based on the appropriate valuation for each shareholding, and the Tribunal's affirmation of that approach was upheld, subject to the stated clarification.

---

---

Issues: Whether, on the facts and in the circumstances of the case, the Tribunal was justified in accepting the valuation of the shares of J. K. Commercial Corporation and J. K. Udyog Ltd. as shown by the assessee for computation of capital gains.

Analysis: The shares of J. K. Commercial Corporation were valued by the assessee at a figure higher than the valuation adopted in the connected wealth-tax proceedings, while the shares of J. K. Udyog Ltd. were valued by the assessee at a figure lower than the valuation so adopted. Where the assessee's declared value is higher than the value reflected in the connected proceedings, the assessee's valuation is to be accepted. Where the value determined in the connected wealth-tax proceedings is higher, that higher value is to be adopted. On that basis, the Appellate Assistant Commissioner correctly directed recomputation of capital gains.

Conclusion: The Tribunal was justified in affirming the order of the Appellate Assistant Commissioner; the question was answered in the affirmative, in favour of the assessee and against the Revenue, subject to the stated clarification.

---