Ajit K.Sengupta, J. - (1.) In this reference under Section 27(1) of the Wealth-tax Act, 1957, the following questions of law have been referred to this court For the assessment years 1979-80 and 1980-81 : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the assessee could not he taxed as 'individual' for the purposes of the Wealth-tax Act, 1957, for the assessment years 1979-80 and 1980-81 and, in that view, holding that the assessments for the assessment years 1979-80 and 1980-81 are liable to be annulled ?" For the assessment years 1981-82 to 1983-84 : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in upholding the direction of the Commissioner of Wealth-tax (Appeals) that the valuation of unquoted shares as made by the assessee on the basis of valuation report by a registered value and not the break-up value of the share as per Rule 1D of the Wealth-tax Rules, 1957, should be taken"
(2.) So far as the question for the assessment years 1979-80 and 1980-81 is concerned, the same deals with the issue whether an association of persons can be subjected to wealth-tax under the 1957 Act. This issue is covered by the assessee's own case for the assessment years 1972-73 to 1974-75 by a judgment delivered on December 22, 1989, in Matter No. 48 of 1982 (CWT v. India Exchange Traders Association). Following the said decision, this question is answered in the affirmative and in favour of the assessee.
(3.) The facts relating to the question pertaining to the assessment years 1981-82 to 1983-84 are that the assessee was holding certain shares. The shares were not quoted on the stock exchange. The assessee adopted the value of such shares on the basis of the valuation report of the registered valuer. The Wealth-tax Officer did not accept the valuation shown and he applied Rule 1D of the Wealth-tax Rules, 1957. As the assessments were cancelled by the Commissioner of Wealth-tax (Appeals), he did not give any finding on this issue. However, the contention of the assessee was accepted by the Tribunal. The Tribunal in fact held that the provisions of Rule 1D are directory. The question, therefore, is whether Rule 1D of the Rules is directory or mandatory.;