1995 (10) TMI 76

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....n her compulsory deposit account on the valuation date as it represents a right to receive annuity and hence, does not constitute an asset under s. 2(e) of the WT Act." 2. The issue as to whether the compulsory deposit is an asset assessable to wealth-tax is covered against the assessee by the following decisions: (i) Smt. Sunanda Devi Singhania vs. CIT (1993) 204 ITR 642 (Cal); (ii) CWT vs. Vidur V. Patel (1995) 124 CTR (Bom) 343 : (1995) 215 ITR 30 (Bom); and (iii) CWT vs. Mst. Ashutosh Kumar Mahadevia (1995) 124 CTR (Bom) 191 : (1995) 215 ITR 200 (Bom). This ground of appeal is accordingly dimissed. 3. Ground No. 2 reads as under: "On the facts and the circumstances of the case, the learned CWT(A) IX, New Delhi erred....

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....ed the capital bonds and accordingly they are no more the assets of the assessee. Assessee has borrowed loans in order to liquidate the overdraft facilities drawn from Grindlays Bank and Bank of Tokyo. Whereas the capital bonds are no longer the assets of the assessee, the debt incurred in order to purchase such bonds has remained the debt of the assessee. Assessee had relied upon the decision of the Madras Bench of the Tribunal in the case of R. Ratnam vs. WTO (1988) 24 ITD 42 (Mad), where under similar circumstances the Tribunal held that the debt being no longer related to the exempted assets was allowable as a deduction in computing the net wealth of the assessee. The learned CIT(A) IX New Delhi, has declined to follow the decision of t....

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....n date including assets required to be included in his net wealth as on that date under the Act, is in excess of the aggregate value of all the debts owed by the assessee other than the debts which under s. 6 are not to be taken into account or debts which are secured on, or which had been incurred in relation to any property in respect of which wealth-tax is not chargeable under this Act and... Expln. 2 to s. 2(m) reads as under: "Explanation 2-Where a debt falling under sub-cl. (ii) is secured on, or has been incurred in relation to, any asset which is not to be included wholly or partly in the net wealth by virtue of the provisions of sub-s. (1A) of s. 5, the amount of such debt shall, for the purposes of the said sub-clause, be limit....