- (1.) This is an appeal from an order passed by the High Court of Gujarat in which following question of law was answered in the affirmative and in favour of the assessee : "Whether on the facts and in the circumstances of the case, the Appellate Tribunal has been right in law in holding that the assessee is not liable to wealth-tax under Wealth-tax Act, 1957 for the assessment year in question -
(2.) The assessment years involved are 1970-71 to 1977-78. The assessee is a club. It filed its return of wealth being called upon to do so for the aforesaid assessment years but contended that it was not liable to be assessed under the Wealth-tax Act, 1957 at all. The Wealth-tax Officer rejected the claim of the assessee. The Appellate Assistant Commissioner was of the view that the assessee could not be brought to tax under the Act because of the earlier decision of Gujarat High Court in the case of Orient Club v. Wealth-tax Officer, 123 ITR 395 : (1980 Tax LR 678). The Tribunal dismissed the appeal upholding the order of the Appellate Assistant Commissioner. The question of law raised by the Revenue was answered by the High Court also in favour of the assessee.
(3.) The club was not incorporated under the Companies Act, 1956. The case of the Revenue is that the club will have to be assessed as an "individual" under the Wealth-tax Act. Section 3 which is the charging section of the Act is as under : "3. (1) Subject to the other provisions contained in this Act, there shall be charged for every assessment year commencing on and from the first day of April, 1957 but before the first day of April, 1993, a tax (hereinafter referred to as wealth-tax) in respect of the net wealth on the corresponding valuation date of every individual, Hindu undivided family and company at the rate or rates specified in Schedule I. (2) x x x";