JUDGMENT
S. Ranganathan, J.
1. These are two applications under section 27(3) of the Wealth-tax Act, 1957, by the assessed pertaining to the assessment years 1971-72 and 1972-73 and seek reference of the same six questions said to be questions of law for the two years. The questions are as follows :
“1. Whether the Tribunal is correct in holding that it is implicit that what is shown by the applicant in the wealth-tax returns will be accepted by the Wealth-tax Officer if it is higher than the valuation of the property arrived at by the application of the said rule 1BB of the Wealth-tax Rules ? Whether the Tribunal is right in holding a principle that value cannot be less than returned and returned value to be a minimum value below which assessment of value cannot be made, rather than an estimate of fair market value ?
2. Whether the Tribunal was correct in indirectly binding the lower authorities not to determine the value of the property below the figure given in the return ?
3. Without prejudice to the other question of law whether the Tribunal was right in not having it clearly brought out in their order setting forth clearly that the returned value at 75% unearned increase/subject to 75% unearned increase (which is the correct and the amount of Government deduction for unearned increase, in the instant property, fully accepted and incorporated by the wealth-tax authorities below), and which in effect is the value of net wealth returned, rather than at 50% unearned increase, will be accepted by the Wealth-tax Officer if it is higher than the valuation arrived at as per rule 1BB ? Whether the Tribunal was right in not setting forth clearly in its order that the returned net wealth was on the basis of the valuation report including subsequent rectification by the registered valuer ?
4. Whether the Tribunal was right in not deciding all the points of facts, on merits, and of law raised in all the remaining original and additional grounds of appeal and the paper books submitted before the Tribunal ?
5. Whether the Tribunal was right in its not considering it necessary to go into or to hear, or to decide all the other contentions/points, of the applicant (except rule 1BB and capital gains), which were many and of vital importance to the case, on merits, on facts and on law, in view of the applicant’s contentions about rule 1 BB ? Whether the Tribunal was right in not making clear in its order that other points were not argued because the Tribunal itself did not feel it necessary to go into them or hear them ?
6. Whether the Tribunal was right in law in holding that the deduction of tax on capital gains in the determination of the fair market value of the property is not allowable ?”
2. The questions sought to be raised pertain to the valuation of a property in New Delhi. The assessed had returned the value of his share in the said property at Rs, 3.06 lakhs in the wealth-tax returns submitted for the two years in question on the basis of the valuation by a registered valuer. The Wealth-tax Officer, however, referred the valuation of the property to a valuation officer and determined the value of the entire property at Rs. 19.44 lakhs and the assessed’s share therein at Rs. 9.72 lakhs. The assessed preferred appeals to the Appellate Assistant Commissioner. The Appellate Assistant Commissioner gave the assessed a relief of Rs. 95,531. The assessed preferred further appeals before the Tribunal. In the grounds of appeal originally filed, the assessed raised certain contentions regarding the valuation of the property as made by the Wealth-tax Officer and the Appellate Assistant Commissioner. But, at the hearing of the appeals before the Tribunal, he raised certain additional grounds with the permission of the Tribunal. By these additional grounds, the assessed contended that the valuation of the property should be done in accordance with the provisions of rule 1 BB of the Wealth-tax Rules and he also contended that in determining the fair market value of the property, the amount of capital gains liable to be charged in the event of property being sold at that price should also be deducted.
3. The Tribunal accepted the assessed’s contention that the valuation should be done under rule 1 BB. Thereupon, the departmental representative sought the Tribunal’s direction that in case the valuation of the property as determined under rule 1 BB turned out to be less than the value returned by the assessed in his returns, the Wealth-tax Officer would be entitled to accept as correct the value returned by the assessed, even though the value determined under rule 1 BB was actually lower. The Tribunal refused to give such a direction but observed that no such direction was necessary “as it is implicit that what is shown by the assessed in the returns will be accepted by the Wealth-tax Officer, if it is higher than the valuation arrived at by the application of the said rule”. Also in the view taken by it regarding the applicability of rule 1BB, the Tribunal did not consider the other grounds that had been urged in the original grounds of appeal. In fact, perhaps because of the view indicated by the Tribunal, the assessed did not argue these grounds of appeal before the Tribunal. It is, in these circumstances, that the assessed has filed these applications for the reference of the above six questions to this court.
4. We are of the opinion, after hearing both counsel, that the first of the above questions does arise out of the order of the Tribunal and may be directed to be referred in a modified form. We, therefore, call upon the Tribunal to state a case and refer for the decision of this court, the following question of law :
“Whether the Tribunal is right in holding as implicit that what is shown by the assessed in the wealth-tax returns will be accepted by the Wealth-tax Officer, if it is higher than the valuation of the property arrived at by the application of rule 1BB of the Wealth-tax Rules ?”
5. We are of the opinion that the other questions need not be referred by the Tribunal. Question No. 2 is purely a consequence of question No. 1 which we have already asked the Tribunal to refer and, therefore, need not be separately referred. Question No. 3 is not pressed on behalf of the assessed and is, therefore, not directed to be referred. So far as questions Nos. 4 and 5 are concerned, they do not arise out of the order of the Tribunal at this stage as the Tribunal has not considered it necessary to decide the grounds raised in the view taken by it that the valuation of the property for wealth-tax purposes had to be made by applying rule 1 BB. It may be that in the event of the above view taken by the Tribunal being upset or reversed by this court in a reference which is pending at the instance of the Commissioner, it may be that the other grounds may arise for consideration. It will be open to the assessed to seek the leave of the Tribunal to urge those grounds at the time of rehearing of the appeal in the event of the Tribunal’s view as to the applicability of rule 1BB. being upset or reversed. But, at this stage, the Tribunal did not consider any of those grounds raised by the assessed in his original grounds of appeal before the Tribunal. Questions Nos. 4 and 5, therefore, do not call for reference at this stage.
6. Question No.6 is no doubt a question of law but the answer to th same same is self-evident and, in our opinion, it does not merit reference to this court. Learned counsel for the assessed pointed out that the Tribunal is not correct in observing in its order that this question was neither argued nor in issue before the Tribunal. As pointed out by him, this question has been discussed and rejected after a brief discussion by the Tribunal in paragraph 16 of its appellate order. However, for the reason we have already mentioned, we do not propose to call for a reference of this question.
7. For the reasons mentioned above, the Tribunal is called upon to refer only one question set out earlier in paragraph 4 hereinabove for the decision of this court. The statement of the case may be a consolidated one for both the assessment years in question. These applications are disposed of accordingly. Costs will abide the ultimate result of the reference.