1. This is a reference by the Income-tax Appellate Tribunal, Madras Bench, under S.27(1) of the Wealth tax Act, 1957. The reference has been made at the instance of the Commissioner of Income-tax, Ernakulam.

2. The assessee is the Travancore Rayons Limited, Rayonpuram. The year of assessment is 1959-60 and the valuation date for the assessment which has been made under S.16(3) of the Act is the 31st December, 1958.

3. The assessment provided by the Act is on the net wealth of the assessee as on the valuation date. The expression "net wealth" is defined in clause (m) of S.2 of the Act. The definition is:

"'net wealth' means the amount by which the aggregate value computed in accordance with the provisions of this Act of all (he assets, wherever located, belonging to the assessee on the valuation date, including assets required to be included in his net wealth as on that date under this Act, is in excess of the aggregate value of all the debts owed by the assessee on the valuation date other than, -

(i) debts which under S.6 are not to be taken into account;

(ii) debts which are secured on, or which have been incurred in relation to, any asset in respect of which wealth-tax is