TaxTMI 
TaxTMI 
1987 (9) TMI 97
X X X X Extracts X X X X
X X X X Extracts X X X X
....ial undertaking, within the meaning of Explanation to s. 5(1)(xxxi) and consequently in holding that the value of assessee's interest in that firm is exempt under s. 5(1)(xxxii) of the WT Act, 1957? 2. The argument of the learned Departmental Representative was that these questions were considered by the Special Bench in the Reference Application No. 78/Jp/86 which arose out of WTA No. 9/Del/ 84 and vide order dt. 11th May, 1987 the Special Bench had granted the reference on both the issues raised by the Revenue though modifying the question. The plea was that the Special Bench ruling is binding on the Division Bench and that though the order of the Third Member in respect of applicability of r. 2B(2) though is at a subsequent to the Special Bench's order would not apply as that issue was a consequence of difference of opinion between two Members and thereby the ruling in the Third Member decision cannot override the ruling of the Special Bench. 3. The plea of the counsel for the assessee was that the issue of onus was not at all considered in these cases. Therefore, question No. 2 cannot be said to arise from the order of the Tribunal. It was also pleaded that the Revenue author....
X X X X Extracts X X X X
X X X X Extracts X X X X
....4 ITR 680 (Raj). 5. As regards the other question of industrial undertaking, the Special Bench did not take into consideration the Supreme Court's ruling and also the Board's Circular which were duly considered in the case of CWT vs. Khell Shanker Durlabhji (1986) 50 CTR (Trib) 42 (Jp) : (1986) 24 TTJ (Jp) 145. The learned counsel submitted that the only objection of the Revenue authorities is not holding the firm in which the assessee is a partner as an industrial undertaking is that there are no machineries. It was in this context reference was drawn to the Board's Circular No. 347 wherein it was concluded that to be a manufacturer : it is not necessary for an assessee to own the plant and machinery and/or to carry out the entire manufacturing operation himself. The specialists who carry out the polishing and other similar jobs are mere contractors. Since this position has been so accepted by the Board in the Circular in which they had followed the ruling of Supreme Court in the case of D.C.M. Ltd. AIR 1963 SC 79, the Board's Circular which is of a binding nature on the Revenue officials, which goes to imply that one of the parties before the Tribunal has to necessarily follow t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of like type, quality and quantity in a particular market at any moment of time though there are several other factors such as economic forces, market vagaries, misinformation, arbitrary decision of buyers and sellers etc. 8. The provisions as are contained in the WT Act in respect of determining the market value are not at all in conflict with the generally accepted commercial principles. The purpose of r.2B(2) is to only bring into the ambit of wealth-tax the various assets which have a definite market value but are shown at a very low value for income-tax assessment purposes. It is a well-known phenomena that market value which is also called the sale price or the price have different connotations. They are known as list price i.e., the prices which are marked on the packages, market quotations such as are available in the case of commodities, stock exchange and several others. The market value which has been spelt in the WT Act is no doubt an approximation but the courts have held in several cases that it should be near about the market value. In the case of assessee(s) before us the accepted factual position by the department is that there are some of the items which have a g....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... regard to market value being one of fact, question No. 1 as preferred would also be a question of fact and accordingly the same requires to be rejected. We may also clarify that the salient point of distinction between the instant cases and that of the case considered by the Special Bench is that of the issue of onus which was the subject-matter of consideration in the Special Bench only and, therefore, that being not the matter of consideration in these cases, as observed by the learned Third Member in the order, the question as referred by the Special Bench cannot be made a point of reference in these cases as well as they do not arise out of the order of the Tribunal. 10. In regard to the last of the issues regarding s. 5(1) (xxxii), we are alive to the fact that the issue was considered by the Special Bench and reference was allowed in favour of the department. The perusal of the Special Bench order indicates that they had not taken into consideration the Board's Circular No. 347 which was issued on the basis of the Supreme Court decision in the case of DCM Ltd. AIR 1963 SC 79. The Board was compelled to issue a circular as a number of petitions were filed by several tax paye....