Banerjee, J. - (1.) THIS is a reference, under Sec. 27(1) of the Wealth -tax Act, made at the instance of both the assessee and the Commissioner of Wealth -tax.
(2.) THE assessment year involved is the year 1958 -59, the relevant valuation date being November 30, 1957.
(3.) THE assessee is a sterling company incorporated in Great Britain and is a manufacturer of tea grown in its own gardens in India. In the computation of its net wealth, as on the relevant valuation date, the assessee, inter alia, claimed deduction in respect of the value of certain residential quarters, store houses and outhouses, plant and machinery, lorries and motor cars and also in respect of certain liabilities said to be taxation liabilities. The Wealth -tax Officer rejected the claims made by the assessee. Thereupon, the assessee appealed before the Appellate Assistant Commissioner, who rejected the claim of the assessee in respect of residential house with the observation that they were not used for the assessees own dwelling house but were merely used for the residential purposes of the employees of the assessee. He, therefore, expressed the opinion that the assessee was not entitled to any exemption in respect of those residential quarters under Sec. 2(e)(ii) of the Wealth -tax Act. Out of the claim for deduction amounting to Rs. 1,28,582 and Rs. 97,008 in respect of store houses and outhouses, the Appellate Assistant Commissioner allowed a deduction of Rs. 28,710 only and rejected the rest of the claim. With regard, however, to the claim of the assessee for deduction of value of the plant and machinery and lorries and motor cars the Appellate Assistant Commissioner held that the following machinery only, valued at Rs. 4,74,255 were entitled to exemption, under Sec. 5(1)(ix) of the Wealth -tax Act, namely : With regard to the claim for deduction for liabilities, said to be taxation liabilities, the Appellate Assistant Commissioner allowed a sum of Rs. 44,39,718 only, and disallowed the balance as not representing any debt owed by the assessee on the material valuation date. Against the order of the Appellate Assistant Commissioner the assessee and the revenue both appealed before the Appellate Tribunal. The Appellate Tribunal affirmed the order of the Appellate Assistant Commissioner in so far as he refused to allow deduction of the value of the residential house in the computation of the net wealth of the assessee with the following observation : "The deduction is claimed on the ground that these are dwelling houses within the meaning of the proviso to Sec. 2(e)(ii). In the case of Calcutta Stock Exchange Association Ltd., a Division Bench of the Calcutta High Court interpreted the word residence used in proviso to Sec. 9(2) of the Indian Income Tax Act to mean the place where a human being eats, drinks and sleeps. The word dwelling house used in Sec. 2(e)(ii) has a narrower significance than the word residence. It is obvious, therefore, that an impersonal entity such as a company cannot require a dwelling house for its own occupation. There is nothing in the proviso to Sec. 2(e)(ii) to suggest that the building required by a cultivator as a dwelling house for the purpose of residence of its employees or agents was also to be entitled to the exemption." ;