Wealth-tax valuation of partner's interest includes written-off bad debts as firm assets under the governing rules.

Amounts written off as bad debts could not be excluded from the firm's assets when computing a partner's interest for wealth-tax purposes. The Tribunal treated the disallowance of the write-off in income-tax proceedings as a final finding of fact, and the claim was also inconsistent with the express valuation rules under the Wealth-tax Rules. The amounts were therefore included as assets of the firm in valuing the assessee's interest, with the issue resolved against the assessee and in favour of the Revenue.

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Issues: Whether amounts written off by the firm as bad debts could be excluded as assets of the firm while computing the assessee's interest in the firm for wealth-tax purposes.

Analysis: The Tribunal's finding that the write-off claim had been disallowed in the income-tax assessment and had attained finality was treated as a finding of fact. The claim was also found to be inconsistent with the express provisions of the Wealth-tax Rules governing valuation of the partner's interest.

Conclusion: The amounts were to be treated as assets of the firm in computing the assessee's interest, and the answer was against the assessee and in favour of the Revenue.

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