V. DONGZATHANG, A. M.: In these appeals by Revenue against order of AAC Revenue raised common question. appeals are, therefore, consolidated and heard together and disposed of by common order for sake of convenience. WTO No. 276 (Del) 82: In asst. yr. 1975-76 WTO computed net wealth of assessee at Rs. 7,53,025 as against returned wealth of Rs. 4,31,016. net wealth included sum of Rs. 4,83,466 which was computed by WTO by taking value of 836 shares in M/s. Industrial Oxygen Co. (P) Ltd. at Rs. 584.29 per share as against Rs. 114.37 per share declared by assessee on basis of valuation on yield basis. Aggrieved by said valuation assessee took up matter in appeal before AAC who allowed claim as follow: "On consideration of all facts and circumstances of case I consider that decision of Supreme Court in case of CGT vs. Smt. Kusumben D. Mahadevia reported in (1980) 14 CTR (SC) 366: (1980) 122 ITR 38 (SC) and of Bombay High Court of same appellant wherein it was held that in similar circumstances as appellant s case, valuation of shares should be determined not on basis of break-up value following r. 1D but basis of yield or profit earning method should be adopted. In case on hand appellant had given detailed calculation for year ended 31st Dec. 1974 arriving at valuation per share at Rs. 114.37. proposition of WTO that r. 1D rules out in case of valuation of shares of company all methods of computation of value of share and restricts scope of enquiry under s. 7(1) only to value on break-up method is incorrect as is amply clear form various decisions discussed above and r. 1D has been held to be directory and not mandatory. It was also not correct for WTO to have brushed aside contentions of appellant that notes appended to balance sheet regarding under provision of depreciation on cylinders amounting to Rs. 47.47 lakhs formed on integral part of balance sheet and that amount of under provision for depreciation has to be reduced from assets. appellant had given basis of calculation on yield method and in this they had taken into account under provision as it was only after taking into account this provision that real value of shares could be arrived at. Further as explained by appellant value of assets (Gas cylinders) was over stated in balance sheet. extent of over valuation was mentioned in notes by auditors. correct value of shares should therefore be value in balance sheet reduced by amount of over-valuation. appellant was able to substantiate this by providing necessary calculation. In this background I have no hesitation to hold that proper method which should have been followed in available of shares on basis of facts available was yield method and not according to what was done by WTO. WTO is, therefore, directed to adopt value of 836 shares or M/s. Industrial Oxygen Co. Pvt. Ltd. on that basis which appellant has declared at Rs. 114.37 per share. This could be checked up by WTO for purpose of arithmetical accuracy. Since I have decided that yield method is to be followed in valuing shares I do not propose to go into other arguments which have been advanced during course of hearing." revenue is aggrieved and has come up in appeal before us contending that AAC of IT erred in directing that value of 836 shares of assessee in M/s. Industrial Oxygen Co. (P) Ltd. be taken according to yield method and not according to r. 1D as rightly valued by WTO. Shri J.R. Malhotra. ld. Departmental Representative vehemently objected to order of CIT holding that proper method for valuation of shares held by assessee in instant case was yield method. According to him issue had been squarely settled in favour of Revenue by following decisions: CWT vs. Sripat Singhania 1977 CTR (All) 119: (1978) 112 ITR 363 (All). CWT vs. Padampat Singhania (1979) 9 CTR (All) 56: (1979) 117 ITR 443 (All). Bharat Hari Singhania vs. CWT. Kanpur (1979) 9 CTR (All) 316: (1979) 119 ITR 258 (All). B. R. Duggal vs. WTO (1982) 2 ITD 55 (Del). Shri J. R. Malhotra, ld. Departmental Representative also relied on decision of Special Bench of Tribunal in case of Shri Biju Patnaik vs. WTO (1981) 12 TTJ (Del) 25: (1981) 1 SOT 623 (Del) (SB) for proposition that rules were mandatory in matter of valuation of assets. On other hand, Shri Devan P. N. Chopra ld counsel of assessee vehemently supported order of AAC. According to him decision of AAC is fully supported by decision of Hon ble Supreme Court in case of CWT vs. Mahadev Jalan & Ors. 1972 CTR (SC) 257: (1972) 86 ITR 621 (SC) reiterated in CGT vs. Smt. Kusumben D. (supra). According ld. counsel although Supreme Court in aforesaid cases was considering case of investment company to which r. 1D did not apply, their observation regarding proper method of valuation relate to shares of private limited company irrespective of whether it was investment company or not. it is contention of ld. counsel of assessee appearing before us that decision of Bombay High Court in case of Smt. Kusmben D. Mahadevia vs. CWT (supra) is on all fours with case of assessee. According to him cases relied upon by ld. Departmental Representative were not exactly applicable. In that issues raised before Hon ble High Court were finally distinguishable. In aforesaid cases issue was never argued as to whether break up valuation of method prescribed by r. 1D was proper method for valuing share of private limited company. ld. counsel of assessee before us admitted that decision of Hon ble Kerala High Court in case of CWT vs. Mamman Vergheses & Ors. (1980) 15 CTR (Ker) 135: (1983) 139 ITR 351 (Ker) is against assessee. In spite of that it is pleaded that when two views are plausible one which is favourable to assessee should be adopted. Finally it has been pointed out that order of WTO suffered from legal flow. In that matter of valuation was not referred by him to Valuation Officer as required by s. 16A of WT Act. We have carefully considered rival submissions in light of papers on our record as also on basis of decisions cited by authorities. There is unanimity in all decisions that any rule prescribed for carrying out provisions of main Act has to be pressed into service while applying said provision. To that extent, there is no quarrel or any conflict in applying said provision. To that extent, there is no quarrel or any conflict in decisions cited before us. However, questions posed before various High Courts are not identical and there are fine distinctions in questions raised for their consideration. In cases of Sripat Singhania & Padampat Singhania (supra) main question before their Lordships was whether authorities including appellate authority can ignore r. 1D prescribed by Board for determination of market value of equity shares of company other than investment company and managing agency companies. question never travelled beyond this point. However, in cases cited on behalf of assessee question before their Lordships went beyond and issue was whether Rule prescribed by Board really serve purpose for which it was framed and whether market value arrived at was real market value as it would fetch if sold in open market on valuation date in terms of s. 7(1). Their Lordships of Hon ble High Court of Allahabad considered implications of rr. 1 C&D in case of CWT vs. Laxmipat Singhania 1977 CTR (All) 225: (1978) 111 ITR 272 (All). This in fact is earlier decision of Hon ble High Court followed in subsequent decisions relied upon by ld. Departmental Representative. In that case their Lordships held r. 1C&D to be rule of procedure or evidence on basis of following analysis; "In deciding whether such rules are rules if evidence or procedure or rules of substantive law, assistance can be derived from following observations of Supreme Court in Izhar Ahmad Khan vs. Union of India AIR 1962 SC 1952, at page 1063: "In deciding question as to whether rule about irrefutable presumption is rule of evidence or not, is seems to us that proper approach to adopt would be to consider whether fact from proof of which presumption is required to be drawn about existence of fact B, is inherently relevant in matter of proving fact B and has inherently and probative or persuasive value in that behalf or not. In fact is inherently relevant in proving existence of fact B and to any rational mind it would bear probative or persuasive value in matter of proving existence of fact, B, then rule prescribing either reputable presumption or irrefutable presumption in that behalf would be rule of evidence. On other hand, if fact is inherently to relevant in proving existence of fact B or has no probative value in that behalf and yet rule is made prescribing for rebuttable or in-reputable presumption in that connection, that rule would be rule of substantive law and not rule of evidence. " In determining value of unquoted preference share, paid up value there of and rate of dividend paid in respect thereof which are prescribed by r. 1C as criteria, are undoubtedly relevant factors. Likewise, for determining value of unquoted equity share, r. 1D prescribed break-up value as basis. well accepted method of valuing unquoted equity share is on basis of its break-up value. Thus, criterion prescribed by r. 1D is undoubtedly relevant one for valuation. In light of enunciation of law by Supreme Court in Izhar Ahmad Khan s case (supra) these two rules must be regarded as rules of evidence or procedure and not rules of substantive law. It follows that rr. 1C and 1D which were inserted in WT Rules by WT (Amendment) Rules, 1967, were applicable to pending assessments of assessee even though such assessments related to assessment years prior to date of coming into force of those rule and relevant valuation dates were also prior to that date." So even in cases cited by Revenue consensus is that r. 1D is rule of procedure or evidence. It is well settled rule of interpretation hallowed by time and sanctified by judicial decisions that if rule of evidence or procedure fails to achieve its objective or in event of repugnancy between substantive provisions of and Act and Rule, it is rule which must give way to provisions of Act. [CIT vs. S. chenniappa Mudaliar (1969) 74 ITR 41 (SC)]. Rules are meant only for purpose of carrying out provisions of Act and they cannot take away what is conferred by Act or whittle down its effect as held by Hon ble Supreme Court in case of CIT vs. Taj Mahal Hotel (supra). Rule of procedure is hand maid to subserve substantive provision and not to override. That being position, limited question before us is whether share value determined by WTO in light of r. 1D represents market value it would fetch if sold in open market on valuation date as provided in s. 7(1) of WT Act. Alternatively whether share value returned by assessee on basis of its valuation is real market value? purchaser of shares in company which is going concern does not usually purchase them with view to attempt to wind up company and to take over same. prudent purchaser of shares, therefore, while taking to see that his purchase many is secured by tangible assets would look mainly to dividends which he could reasonably expect too receive, such dividend as were appropriate to nature of business. normal purpose of purchase is to provide for annuity, yearly income from outlay, some sort of return commensurate with price paid for, In spite of uncertainties, vicissitudes and fluctuations, purchaser all same expect income which will tend to increase from year to year than decrease. Hon ble Supreme Court in case of CWT vs. Mahadev Jalan (supra) set out various aspects to be considered while valuing shares of company. said decision was quoted liberally by Hon ble Bombay High Court in case of Smt. Kusumben D. Mahadevia (supra), and reproduced by CIT (A) in his order extensively. After setting out those conditions Hon ble Supreme Court observed as follows: "In setting out above principles, we have not tried to lay down any hard and fast rule because ultimately facts and circumstances of each case, nature of business prospects of profitability and such other consideration will have to be taken into account as will be applicable to facts of each case. But one thing is clear, market value, unless in exceptional circumstances to which we have referred, cannot be determined on hypothesis that because in private limited company one holder can bring it into liquidation, it should be valued as on liquidation by break-up method. yield method is generally applicable method while break-up method is one resorted to in exceptional circumstances or where company is ripe for liquidation but none less is one of methods." above tests cannot be applied to present case before us. WTO simply applied r. 1D without looking into nature of business of assessee, product and its profitability and such other considerations. Similarly valuation report of approved valuer Simply took profits of years without bringing on record balance sheet and P&L A/c of assessee. As rightly pointed out by Hon ble Supreme Court share value is influenced by many factors. That is why share investment becomes quite complicated affair involving sale brokers and speculators. We have bears and till who are either having optimistic or pessimistic view. If market value of shares is ascertainable purely on intrinsic value of company, then share valuation would not require appointment of valuers in terms of s. 16A of WT Act also. Having regard to these facts and circumstance have no option but to set aside order of lower authorities and restore matter to file to WTO with direction that he will recomputed market value of shares of assessee in light of observations given above. In doing so he shall give reasonable opportunity of being heard to assessee and arrive at market value as on valuation date after taking into account submissions and evidences placed before him. With regard to second ground regarding valuation of property at Golf Links in accordance with r. 1BB, matter is fully covered by decision of Special Bench of Tribunal in case of Shri Biju Patnaik (supra). Respectfully following Special Bench decision we uphold order of AAC in this regard. In result appeal shall be treated as partly allowed of statistical purpose only. WTA Nos. 2077,2072, 2073 & 2078 In view of detailed order above these appeals of Revenue are partly allowed for statistical purpose. WTA Nos. 2074 & 2075 For reasons fully discussed by us in case of Shri Devndra Kumar Jain in WTA No. 2076 (Del)/82 both appeals of Revenue fail and are dismissed. *** WEALTH-TAX OFFICER v. DEVENDRA KUMAR JAIN