D.K.JAIN, J. - (1.) BY this petition under s. 26(3) of the GT Act, 1958 (for short the Act), the Revenue seeks a direction to the Tribunal, Chandigarh Bench, Chandigarh (for short the Tribunal), to state the case and refer the following question, stated to be one of law, arising out of GTA No. 30/Chd/1982 pertaining to the asst. yr. 1974 -75 : "Whether, on the facts and circumstances of the case, the Tribunal was right in law in directing the GTO to adopt the value of the gifted shares as declared by the assessee -
(2.) BRIEFLY stated, the material facts relevant for the purpose of this petition are as follows :
(3.) DURING the course of proceedings under the income -tax for the relevant assessment year, the ITO noticed that the assessee had sold 776 shares of M/s Oswal Spinning & Weaving Mills Ltd. at the face value of Rs. 100 per share. He referred the matter of valuation of these shares to the Valuation Officer under s. 55A of the IT Act, 1961, who evaluated the shares at Rs. 358.50 per share. Adopting the said value he computed the capital gains of the shares transferred in the hands of the assessee. Simultaneously, as GTO he treated the difference between the declared sale consideration and the value of the shares as determined by the Valuation Officer as deemed gift and subjected an amount of Rs. 2,00,596 to gift -tax. 3. Aggrieved, the assessee preferred appeal to the AAC, who set aside the assessment, inter alia, on the ground that the method of valuation adopted by the Valuation Officer was not correct, in view of the decision of the apex Court in CWT vs. Mahadeo Jalan & Ors. 1972 CTR (SC) 395 : (1972) 86 ITR 621 (SC). Being aggrieved by the said order, the Revenue as well as the assessee took the matter in further appeal to the the ITO in enhancing the capital gains on the basis of the valuation report, had been set aside by the first appellate authority and the said decision had been accepted by the Revenue, as the capital gains have been computed by the AO on the basis of the sale consideration declared by the assessee, on the same analogy for the purpose of gift -tax, the value of the share had to be taken at the rate declared by the assessee. While coming to the conclusion that there has been no understatement of value of shares declared by the assessee, the Tribunal has relied on the decision of the Supreme Court in K.P. Varghese vs. ITO & Anr. (1981) 24 CTR (SC) 358 : (1981) 131 ITR 597 (SC).;