Judgment

HEGDE, J: These appeals arise form the decision of the High Court of Calcutta in a reference under S. 27 (1) of the Wealth Tax Act, 1957 (to be hereinafter referred to as the Act). In that decision, the High Court was requested to give its opinion on two questions of law referred to it by the Income-tax Appellate Tribunal, B Bench, Calcutta, Following the decision of this Court in Commr. of Wealth-tax v. Ramaraju Surgical Cotton Mills Ltd. 63 ITR 478 the High Court answered the second question against the Revenue. That decision has become final. At present we are only concerned with the first question of law referred to the High Court for its opinion. That question reads:

"Whether on the facts and in the circumstances of the case, the sum of lb. 8,54,948 was deductible in determining the net value of the assets of the assessee s business under section 7 (2) (a) of the Wealth -tax Act?"

2. The assessee is a Sterling Company incorporated in U.K. It carries on business of supplying electric energy in the city of Calcutta. During the year 1959-60, the corresponding valuation date being March 31, 1959, the assessee showed in its balance-sheet a deduction of 1b. 8,54,948 from th