Prakash Krishna, J. - (1.) The following question of law has been referred to this Court at the instance of the Revenue : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the depreciation, which was not a liability shown in the balance sheet should be deducted while valuing the unquoted shares under Rule 1D of the WT Rules, 1958 ?"
(2.) the assessee is an. HUF and the assessment year involved is 1969-70. The assessee held certain shares in M/s J.K. Jute Mills Company Ltd., Kanpur/The assessee claimed that while valuing the shares of the aforesaid company under Rule 1D of the WT Rules, deduction should be allowed for unprovided depreciation, The WTO did not agree with the contention of the assessee and held that only such deductions could be allowed which are provided for under the aforesaid Rule 1D. In appeal before the AAC, the contention of the assessee was accepted. The judgment of the AAC was confirmed in further appeal before the Tribunal.
(3.) The Hon'ble Supreme Court in Bharat Hari Singhania v. CWT (1994) 207 ITR 1 (SC) has held that Rule 1D of the said Rules is mandatory and has rejected the contention of the assessee that it is merely directory and that it need not be followed at the choice of the WTO or the assessee. The aforesaid view has been reiterated by the Supreme Court in CWT v. T.S. Santhanam (HUF) and Ors. (2001) 248 ITR 575 (SC).;