V.K. SINGHAL, J. - (1.) BOTH the above references are disposed of by this common order since the question of law involved is common.
(2.) THE facts of Parasmal Kanji are that the Tribunal in respect of asst. yr. 1981-82 held that the provisions of r. 1D of WT Rules are mandatory and, as such the valuation has to be done in accordance therewith. This controversy has been set at rest by the apex Court in the case of Bharat Hari Singhania vs. CWT (1994) 118 CTR (SC) 125 : (1994) 207 ITR 1 (SC) wherein it has been held by the apex Court that the provisions of r. 1D of the WT Rules are mandatory. THE apex Court observed as under : "(1) Rule 1D is perfectly valid and effective. THE rule has to be followed in every case where unquoted equity shares of a company (other than an investment company or a managing agency company) have to be valued. All the authorities under the Act including the Valuation Officer are bound by the said rule. THE question of the rule being mandatory or directory does not arise. (2) While valuing the unquoted equity shares under r. 1D, no deductions on account of capital gains tax which would have been payable in case the said shares were sold on the valuation date can be made. Similarly, no other deductions including provision for taxation, provident fund and gratuity are admissible. Rule 1D is exhaustive on the subject. (3) Expln. 1 to r. 1D is a perfectly valid piece of delegated legislation and has to be followed. Merely because the valuation date of the assessee and the date with reference to which the balance-sheet of the company is drawn up do not coincide, it cannot be said that r. 1D is not mandatory or that it need not be followed. (4) Sub-cl. (a) of cl. (i) and sub-cl. (e) of cl. (ii) have to be read and understood in the manner indicated in this judgment hereinabove. (5) An assessee holding shares in a company whose assets comprise wholly or partly of agricultural land, is not entitled to exclude such shares from his wealth." Following the said decision, we are of the opinion that it was incumbent on the part of the WTO to have followed the provisions of r. 1D of the WT Rules. Accordingly, the reference is answered in favour of the Revenue and against the assessee. No order as to costs.;