1977 (11) TMI 22

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.... two questions which have been referred at the instance of the assessee are : "(1) Whether, on the facts and in the circumstances of the case, wealth-tax payable by the assessee under the W.T. Act, 1957, of Rs. 3,00,528 for the assessment year 1959-60, is an allowable deduction under s. 10(1) of the Indian I.T. Act, 1922, in arriving at the total income for the said assessment year ? (2) Whe....

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....in Travancore Titanium Products Ltd. v. CIT [1966] 60 ITR 277 held the field. In this case, the Supreme Court had held that the tax on the wealth of the assessee was not allowable as business expenditure under s. 10(2)(xv). Consequently, the deduction with regard to the amount of the wealth-tax was held to be impermissible and so also the amount claimed to be deductible by way of professional fees....

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....reme Court in 1972, there is no doubt that the first question would have been required to be answered in favour of the assessee and the consequence would then have been that even the second question would have had necessarily to be answered in favour of the assessee. It appears, however, that Parliament intervened after the decision of the Supreme Court and by s. 4 of the I.T. (Amend.) Act, 197....

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....fect the proceedings for assessment in respect of the assessment year 1959-60. The result, therefore, is that in view of this provision, the amount of wealth-tax paid by the assessee could not be a permissible deduction. However, so far as the professional fees in respect of the said wealth-tax assessment is concerned, the matter, in our view, will have to be viewed in a slightly different mann....