Wealth-tax exemption must be allowed in each co-owner's hands, not deducted from the estate's total valuation first.

Exemption under section 5(1)(iva) of the Wealth-tax Act is to be granted in the hands of each individual owner to the extent of his share, rather than being deducted while valuing the estate as a whole. The Tribunal followed its earlier view that the statutory deduction applies at the stage of individual wealth assessment after apportionment among co-owners. On that basis, the assessee's share was entitled to exemption in his own hands, and the full estate valuation was not reduced first by the exemption.

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Issues: Whether the exemption under section 5(1)(iva) of the Wealth-tax Act, 1957, was to be granted at the stage of valuing the estate as a whole or in the hands of each individual member owning a share in the estate.

Analysis: The assessment proceeded on the footing that the assessee's 1/7th share in the estates was includible in his individual wealth. The question was the proper stage for granting the statutory exemption. The Tribunal followed its earlier view that the deduction under section 5(1)(iva) is to be allowed in the hands of the individual owner to the extent of his share, and not while valuing the total estate before apportionment among the shareholders.

Conclusion: The assessee was held entitled to exemption under section 5(1)(iva) to the extent of Rs. 1,50,000 in his own hands, and the exemption was not to be deducted at the stage of valuation of the estates as a whole.

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