Ajit K. Sengupta, J.
1. In this reference under Section 27(1) of the Wealth-tax Act, 1957, for the assessment years 1984-85 to 1986-87, the following common questions of law have been referred to this court:
'(1) Whether the Income-tax Appellate Tribunal was justified in remanding the matter to the Assistant Commissioner of Wealth-tax to enable the Assistant Commissioner of Wealth-tax to make a reference to the Valuation Officer under Section 16A of the Wealth-tax Act ?
(2) Whether the Income-tax Appellate Tribunal is empowered under the provisions of the Wealth-tax Act to extend the time limit prescribed for completion of the assessment by remanding the matter to the Assistant Commissioner of Wealth-tax to make a reference under Section 16A of the Wealth-tax Act, 1957?'
2. Shortly stated, the facts are that the assessee, inter alia, held 19,997 shares of Jaipur Finance and Diary Products Pvt. Ltd. In the wealth-tax return, the assessee declared the value of these shares at Rs. 111.06 per share on the basis of a registered valuer's report. The Assessing Officer estimated the value at Rs. 106.62 (sic) per share allegedly following the instructions of the Central Board of Direct Taxes contained in Circular No. 332A dated March 31, 1982 (see [1982] 135 ITR 11).
3. On appeal to the Commissioner of Wealth-tax (Appeals), it was pointed out that the said instructions are contrary to the well-recognised and well-settled principles of valuation as laid down by the Supreme Court. It was further pointed out that, in case the Assessing Officer wanted to reject the valuation as shown by the assessee, it was mandatory on him to make a reference to the Valuation Officer under Section 16A of the Wealth-tax Act. It was further submitted that once the Assessing Officer has not exercised the option to make a reference under Section 16A at all till the completion of the assessment, the same cannot be done at the appeal stage.
4. The fair market value of the immovable property (land and building) was shown at Rs. 3,50,460 on the basis of the report dated May 2, 1985, of the registered valuer. The Assessing Officer, while valuing the said immovable property, had taken its value at Rs. 5,50,000 without any basis. The Commissioner of Wealth-tax (Appeals), Central-I, restored the matter of valuation of the said shares and the movable property back to the Assessing Officer for the purpose of making valuation of the said assets afresh following the order of the Tribunal for the preceding year.
5. On second appeal, the Income-tax Appellate Tribunal remanded the matter to the Assistant Commissioner of Wealth-tax with a direction that he may refer the question of valuation of shares of Jaipur Finance and Diary Products P. Ltd. to the Valuation Officer under Section 16A of theWealth-tax Act. The Income-tax Appellate Tribunal has thus allegedly extended the time-limit for completion of the assessment as prescribed under Section 17A of the Wealth-tax Act. Hence, this reference.
6. At the hearing before us, it has been contended on behalf of the asses-see drawing our attention to a decision of the Madhya Pradesh High Court in M.V. Kibe v. CWT : [1987]168ITR82(MP) , that the appellate authorities cannot direct the Assessing Officer who is also a quasi-judicial Officer to exercise his discretion in a particular manner. By that process, the proceeding court be allowed to be reopened to give an extended period of limitation (sic).
7. In M.V. Kibe : [1987]168ITR82(MP) , the assessee preferred appeals before the Appellate Assistant Commissioner against the orders of assessment passed by the Wealth-tax Officer. Under Section 16A of the Act, the Wealth-tax Officer may refer the valuation of any capital asset to a Valuation Officer in a case where the assessee has got the asset valued by a registered valuer and the value returned is in accordance with the estimate made by the registered valuer, if he is of the opinion that the value as estimated by the registered valuer is less than the fair market value of the asset. Such reference may also be made to the Valuation Officer where the Wealth-tax Officer is of the opinion that the fair market value of the asset exceeds the value of the asset as returned by more than such percentage of the value of the asset as returned or by more than such amount as may be prescribed. He may also make a reference to the Valuation Officer where, having regard to the nature of the asset and other relevant considerations, the Wealth-tax Officer considers it necessary to do so. The reference can be made only for the purpose of making an assessment. Whether or not a reference is to be made will depend on the facts and circumstances of a particular case. In the case before us, no reference was made by the Wealth-tax Officer to the Valuation Officer. It will appear from the order of assessment that the immovable property was valued by the valuer, but the Wealth-tax Officer estimated the value of such immovable property. Similarly, he did not accept the valuation of the shares of Jaipur Finance and Diary Products Pvt. Ltd. on the basis of the valuation made by the registered valuer. He proceeded to value the shares on the basis of a circular of the Board [see [1982] 135 ITR 11]. The assessee, being aggrieved, contended before the Commissioner of Wealth-tax (Appeals) as well as before the Tribunal that the Wealth-tax Officer was not justified in making an estimate of the valuation of the immovable property and in valuing the unquoted shares of Jaipur Finance and Diary Products Pvt. Ltd. in terms of the circular of the Board [see [1982] 135 ITR 11]. In disposing of the appeal, it was necessary for the Tribunal to determine the correct valuation of the immovable property and the shares. When an assessee prefers an appeal to the Tribunal, the Tribunal has the authorityto deal with the impugned order of the Commissioner of Wealth-tax (Appeals) in such manner as it deems fit in exercise of its appellate powers ; for instance, it can confirm the impugned order ; it can annul the order ; it can, after vacating the case, remand the case to the Commissioner of Wealth-tax for making a fresh assessment in the light of the observations made by it in its judgment or, after calling for a remand report, rectify the erroneous order of the Wealth-tax Officer. As an appellate authority, the Tribunal could do what the Wealth-tax Officer could have done. In the instant case, the question was whether the valuation of the registered valuer represented the correct value or not. Under the circumstances, it was absolutely essential to refer the matter to the Valuation Officer. The Tribunal could have set aside the entire assessment directing the Wealth-tax Officer to make a fresh assessment after referring the matter to the Valuation Officer. Since it was not necessary in this case to set aside the assessment order in its entirety, the Tribunal directed the Assessing Officer to determine the disputed valuation of the shares and immovable property. The determination of the valuation of any asset is entirely a matter of procedure and that can be done at any stage of the proceeding inasmuch as the appeal is a continuation of the original proceeding. In an appeal, it is open to the Tribunal to interfere with the discretion exercised by the lower authorities and substitute it by its own discretion. It is also open to the Tribunal to direct the authority to exercise its discretion where failure of such authority to exercise such discretion may result in an improper assessment. As in the instant case, the Wealth-tax Officer, although differing from the valuation of the registered valuer, did not refer the case to the Valuation Officer which he ought to have done in the facts and circumstances of the case. We think, in the circumstances, the Tribunal was right. We have not been able to persuade ourselves to hold that the appellate authority cannot direct the subordinate authority to exercise its discretion vested in such authority. With respect, we do not agree with the view expressed by the Madhya Pradesh High Court in M.V. Kibe : [1987]168ITR82(MP) .
8. The other question which is inextricably connected with the first question is the question of the extended period of limitation. It is now well-settled that there is no period prescribed within which an appeal against the impugned order has to be disposed of by the Tribunal in the normal course. The bar of limitation is on the Wealth-tax Officer's power to make an assessment. It will be applicable only to the initial order to be made by him and not to an order that would be made by him pursuant to a direction from the Appellate Authority. It will be anomalous if the Tribunal is not in a position to set aside the order of the Wealth-tax Officer and remand the case to him for making a fresh assessment because the time limit for making the assessment had already expired. In our view, theassessments have been set aside by the Tribunal to the limited extent of making a fresh assessment in respect of the immovable property and shares after obtaining the valuation report. Therefore, the question of extending the period of limitation for completing the assessment does not and cannot arise at all.
9. For the foregoing reasons, the first question in this reference is answered in the affirmative and in favour of the Revenue and against the assessee.
10. We answer the second question by saying that the question of extension of time limit prescribed for completion of the assessment does not arise in the facts and circumstances of the case.
11. There will be no order as to costs.
Bhagabati Prasad Banerjee, J.
12. I agree.