Commissioner of Wealth-tax vs Trustees of H.E.H. the Nizam''s W.G. Trust

Delay condoned and leave granted in the special leave petition.

The Revenue sought the reference of two questions to the High Court of Andhra Pradesh (see Commissioner of Wealth Tax Vs. Trustees of H.E.H. The Nizam's Wedding Gifts Trust, ). In the present appeals, only one question is pressed, namely, question No. 2, which reads thus (page 233):

"2. Whether, on the facts and in the circumstances of the case, the income tax Appellate Tribunal was correct in law in holding that the right to wear the jewellery is not an asset so as to be assessed u/s 21(1) of the Wealth-tax Act, 1957, in the hands of the trust representing the beneficiary, even after the retrospective amendment of section 5(1)(viii) of the Wealth-tax Act, 1957, by the Finance (No. 2) Act, 1971 ?"

The High Court declined to call for the references. In its view, the question was covered by an earlier decision which it quoted.

Our attention has been drawn to the terms of the trust deed herein and to what has been said about the trust deed that was before the High Court in the earlier case in the judgment that was relied upon. We find that there is a material difference. We do not dilate on that difference because we do not wish to prejudice the case on either side. It is enough to say that, having regard to such difference, a question of law does arise which requires the consideration of the High Court.

Accordingly, the appeals are allowed. The orders under appeal are set aside in so far as they relate to the question quoted above. The Tribunal shall refer that question to the High Court for its consideration, after drawing up statements of case. No order as to costs.