Contingent liability exclusion: provision for gratuity not treated as liability when valuing unquoted shares under wealth tax rules. Contingent liabilities are excluded when determining the market value of unquoted equity shares under Rule 1D; a provision for gratuity is a contingent obligation arising only on determination of employment and does not qualify as a present debt, and therefore cannot be treated as a liability for share valuation purposes, a position which assessing officers should apply.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Contingent liability exclusion: provision for gratuity not treated as liability when valuing unquoted shares under wealth tax rules.
Contingent liabilities are excluded when determining the market value of unquoted equity shares under Rule 1D; a provision for gratuity is a contingent obligation arising only on determination of employment and does not qualify as a present debt, and therefore cannot be treated as a liability for share valuation purposes, a position which assessing officers should apply.
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