Wealth Tax Act-Loss to revenue on account of change in previous year u/s 3(4).

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....3-84), the Hon'ble P.A.C. have expressed unhappiness over the situation in the following terms:- Para 2.14 Audit has pointed out an instance wherein a change in the previous year permitted by the Income-tax Officer to an assessee trust had resulted in loss of revenue of about Rs. 4,88,000 in that the wealth valued at Rs. 72,26,500 had escaped assessment to wealth-tax in respect of the assessment year 1974-75. Such instances have come to notice in the past also wherein consent given by the Income-tax Officer for the change of the accounting year had resulted in loss of revenue. Under Section 3(4) of the Income-tax Act, 1961 an assessee can change his previous year in respect of a business or profession with the consent of the Income-ta....

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....ditions while allowing a change of previous year, he must consider the terms put forward by the assessee carefully and if he find that the terms are insufficient to safe-guard the interest of revenue, he has a good ground for refusing the change. Following guidelines are given with a view to protect the interests of revenue under the Wealth Tax Act while allowing a change of previous year:- 3.2 The Wealth tax is levied on net wealth of person on a particular date known as the valuation date. The valuation date as defined in Section 2(q) of the Wealth Tax Act is linked with the previous year as defined in Section 3 of the Income tax Act, 1961. The previous year is either the financial year preceding the assessment year or any other accoun....