1986 (10) TMI 60

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.... has taken the following common grounds in all these appeals: "1. The ld. AAC of Wealth-tax erred in law and on facts in directing the WTO to accept the returned wealth in the case of the assessee. 2. The ld. AAC of Wealth-tax erred in law and on facts in holding that the net wealth of the firm has to be determined in accordance with the commercial principles and what can be assessed in the hands of partner under the WT Act is nothing but the share in assets of the firm as per book of the firm. 3. The ld. AAC of Wealth-tax erred and failed to see that the assets involved in the case are fixed assets and the ratio laid down by the Allahabad High Court in the case of Juggilal Kamlapat Bankers and Anr. reported in (1979) 116 ITR 646 (....

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....the interest of the partners in a firm shall be determined on the basis of r. 2 of the WT Rules, 1957. Proceeding further, the departmental representative contended that the decision of their Lordships of the Allahabad High Court in the case of Juggilal Kamlapat Bankers and Anr. vs. WTO & Ors. came up for consideration of their Lordships of the Supreme Court in (1984) 39 CTR (SC) 47 : (1985) 145 ITR 485 (SC), wherein the decision of the Allahabad High Court was approved and it was held that the partner in the firm has to be valued in accordance with r. 2 of the WT Rules, 1957. Therefore, the departmental representative on the strength of the aforesaid decision strongly urged before us that the decision of the AAC is incorrect. Lastly, he ur....

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.... was next held that for this purpose s. 7 and the relevant rule have to be applied. Accordingly, a single asset belonging to the firm can also be valued at market price for the purpose of determining the value of the partner's interest in the firm. Their Lordships of the Supreme Court in the case of Juggilal Kamlapat Bankers and Another vs. WTO (1984) 39 CTR (SC) 47 : (1985) 145 ITR 485 (SC) held as under: On a fair reading of s. 7 of the Act and rr. 2A and 2B of the WT Rules, 1957, it is clear that the primary method of determining the value of assets for the purposes of the WT Act is the one indicated in s. 7(1), inasmuch as it provides that the value of any asset other than cash shall be estimated to be its market price on the valuati....