JUDGMENT Bisi, J. : On a reference under Section 27(3) of the Wealth Tax Act, 1957 the following questions of law have been referred for our opinion:- 1. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in law in holding that assumption of jurisdiction by the Commissioner of Wealth Tax, under Section 25(2) of the W.T. Act, was not correct, when the mistake in the matter of treatment of proposed dividend as liabilities, has been admitted by the Tribunal. 2. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in holding on the basis of the statement filed by the assessee, that cumulative value of the shares of various companies determined by the WTO was in excess of their value as per break up value method when details contained in the said statement are not discussed by the Tribunal in its order. 2. The assessment years involved in the reference relate to 1982-83 and 1983-84 for which the valuation dates were 31st March, 1982 and 31st March, 1983 respectively. The assessments were completed by the Assessing Officer under Section 16(3) of the Wealth Tax Act, 1957 (hereinafter referred to as "the Act") accepting the computation of the value of the unquoted equity shares in five companies by break-up method as submitted by the Assessee. On examination of the assessment records, the Commissioner of Wealth Tax found that the Assessing Officer made the following irregularities in valuing the shares which are contrary to the provisions of Rule 1D of the Wealth Tax Rules, 1957:- (i) Items like advance-tax and prepaid expenses were treated as assets for the purpose. (ii) Items like amount set apart for payment of dividend where such dividends were not declared before the valuation date at a general meeting of the Company, were taken as liabilities. (iii) Provisions for taxation in excess of the tax computed with reference to above profits, were treated as liabilities. 3. The Commissioner of Wealth Tax concluded that because of the above irregularities the assessments of the Assessing Officer for the aforesaid two years were erroneous and pre-judicial to the interest of revenue and therefore, the assessment orders were set aside by the Commissioner of Wealth Tax by invoking the provisions of Section 25(2) of the Act. 4. 3. The Commissioner of Wealth Tax concluded that because of the above irregularities the assessments of the Assessing Officer for the aforesaid two years were erroneous and pre-judicial to the interest of revenue and therefore, the assessment orders were set aside by the Commissioner of Wealth Tax by invoking the provisions of Section 25(2) of the Act. 4. The assessee came up in appeal before the Tribunal against the orders of the Commissioner of Wealth Tax. The Tribunal followed the order passed in the case of M.S. Oberoi (WTA Nos. 284 to 286 (Cal) of 1989) wherein it was held that the first ground would render the orders passed by the Assessing Officer erroneous, but no prejudice to the revenue has been caused, whereas under Section 25(2) of the Act erroneous order can only be refused if it causes prejudice to the interest of the revenue. With reference to the chart of the correct valuation of the shares in various companies filed by the Assessee, the ,Tribunal held regarding the second ground that there was a mistake in the matter of treatment of the proposed dividends as liabilities, but the gain resulting from this rectification would be cancelled by the revenue loss that would result in if the advance tax paid by the assessee was excluded from the aggregate value of the shares of various companies determined by the Assessing Officer in excess of their value as per breakup method. With regard to the third ground the Tribunal held that no prima facie case was made out by the Commissioner of Wealth Tax to show that the provision for taxation was in excess of the tax payable on book profits. The order of the Commissioner of Wealth Tax passed under Section 25(2) of the Act was vacated by the Tribunal. 5. It appears from the order passed by the Tribunal, in WTA Nos. 287 and 288 (Cal) of 1989 relating to the assessment years 1982-83 and 198384. Shri P.R.S. Oberoi, Calcutta v. Deputy Commissioner of Wealth Tax, that the facts and arguments advanced by the parties in the said case before the Tribunal were similar to those in the case of M. S. Oberoi, WT A Nos. 287 and 288 (Cal) of 1989 relating to the assessment years 1982-83 and 198384. Shri P.R.S. Oberoi, Calcutta v. Deputy Commissioner of Wealth Tax, that the facts and arguments advanced by the parties in the said case before the Tribunal were similar to those in the case of M. S. Oberoi, WT A Nos. 284 to 286 (Cal.) of 1989 and for the reasons already given in the order of ,the Tribunal in the said case of M. S. Oberoi, the Tribunal vacated .the orders passed by the Commissioner of Wealth Tax under Section 25(2) of the Act in the case of P.R.S. Oberoi. 6. On hearing the rival contentions of the parties and going through the relevant documents the Tribunal made the observation which are as follows:- "As observed supra, in the notice issued by the CWT three grounds have been set out by him for assuming jurisdiction under Section 25(2). The first ground would render the order passed by the WTO erroneous but no prejudice to the revenue has been cast as contended by the CWT in his order. We have to remember in this connection that it is not that every erroneous order can be revised under Section 25(2). The order has not only to be erroneous but has also to be prejudicial to the interest of the revenue. It is an admitted fact that in some cases the proposed dividends were not treated as liability but as have been rightly contended by the assessee these mistakes go to cancel out the earlier mistake of the assessee in treating the advance-tax paid as an asset. At the time of appeal hearing the assessee was required to file a chart of the correct valuation of the shares held by the assessee in the various companies. On perusal of chart we find that the values adopted by the WTO in the Wealth assessments are more than the value as per Rule 1D method. To illustrate in this case the Oberoi Hotels (India) Pvt. Ltd., the value of these shares taken in the Wealth-Tax assessment was Rs. 1002.43 whereas as per the correct working it should be Rs. 921/-. To illustrate in this case the Oberoi Hotels (India) Pvt. Ltd., the value of these shares taken in the Wealth-Tax assessment was Rs. 1002.43 whereas as per the correct working it should be Rs. 921/-. There has no doubt been an under-valuation in the valuation of shares, of Oberoi Holdings Pvt. Ltd., Oberoi Investments Pvt. Ltd., Oberoi Properties Pvt. Ltd. and Oberoi Holdings and Investments Pvt. Ltd. But, the over all effect as per the statements filed before us in the course of hearing to which the departmental representative had also access was that the cumulative value of the shares of various companies determined by the WTO was in excess of their value as per the break-up value method. In these circumstances we are of the view that the assumption of jurisdiction by the CWT is not correct. Though the CWT has only set aside the order, the exercise of making a fresh assessment order is not likely to result in any advantage to the revenue. We might in this connection like to mention that the provisions of Section 25(2) of the W.T. Act are not to be regarded as revenue raising provisions. These powers have to be exercised by the CWT in the circumstances where the order passed by the WTO is found to be erroneous being prejudicial to the interest of the revenue. As observed earlier in the' notice issued by the CWT three alleged lapses were pointed out. The first as stated earlier, has not resulted in any loss to the revenue at all. As regards the second, the non-deduction of proposed dividend as liability has resulted in passing of an erroneous order prejudicial to the interest of the revenue gain resulting from this, rectification would, be cancelled by the revenue loss that would result in, if the advance-tax paid by the assessee is excluded from the aggregate value of the assets. Not even a prima facie case has been made out by the CWT to show that provision for taxation was in excess of the tax payable on the book profits. Powers of the CWT under Section 25(2) are quasi-judicial powers and not administrative. The assessee in reply to the notice issued by the CWT requested him to give details of the figures of under-valuation given by him in the notice and no such details were furnished to the assessee. Powers of the CWT under Section 25(2) are quasi-judicial powers and not administrative. The assessee in reply to the notice issued by the CWT requested him to give details of the figures of under-valuation given by him in the notice and no such details were furnished to the assessee. The orders were passed without in any way considering the objections of the assessee or without proper discussion as to why the orders passed by the WTO were considered to the erroneous being prejudicial to the interest of the revenue. Since the orders have been passed in a routine way, we are of the view that the same cannot be upheld. The exercise of jurisdiction under Section 25(2) is regarded as without Jurisdiction and the orders passed by the CWT are vacated." 7. It was submitted by Mr. Bhowmick the learned Advocate for the revenue that a reference under Section 27(3)' of the' Wealth Tax Act was made in the case of Shri M. S. Oberoi and the Division Bench of this Court did not agree with the view taken by the Tribunal in the said case and both the questions referred to this Court were answered in favour of the revenue. The xerox certified copy of the order of the Division Bench passed on 25.4.94 in Matter No. 3791 of 1991 Commissioner of Wealth Tax, West Bengal-III, Calcutta v. Shri M. S. Oberoi was produced on behalf of the revenue before us during hearing of the instant reference case. As already pointed out, the Tribunal decided the case of Shri P.R.S. Oberoi out of which the instant reference case has arisen on the basis of its findings made in the case of M.S. Oberoi since the facts and arguments advanced by the parties in the case of P.R.S. Oberoi are similar to those in the case of M.S. Oberoi and the orders passed by the Commissioner of Wealth Tax under Section 25(2) of the Act had been vacated by the Tribunal in view of the reasons given in the order passed in the aforesaid case of M.S. Oberoi. There can hardly be any room for controversy that the facts of the case of M.S. Oberoi are similar to those in the case of P.R.S. Oberoi and the question referred to this Court in the instant case of P.R.S. Oberoi are substantially identical with the questions referred to this Court under Section 27(3) of the Act in the present reference case arising out of the case, of P.R.S. Oberoi. So the judgment passed by the Division Bench of this Court in Matter No. 3791 of 1991 (supra) is of considerable .importance for the purpose of decision of the instant reference case. 8. Dr. Pal appearing for the assessee contended on the other hand that the Tribunal found that the assessee was required to file a chart of the correct valuation of the shares held by the assessee in the various companies and on perusal of the chart it was found by the Tribunal that the value as adopted by the Wealth Tax Officer in the wealth tax assessment was more than the value as per Rule 10 method. It was further argued by Dr. Pal that overall effect as per the statements filed before the Tribunal in the course of the hearing was that the cumulative value of the shares of various companies determined by the Assessing Officer was in excess of their value as per the break-up value method under Rule 1D. 9. It appears that in the instant matter by the order dated March 21, 2001 this Court directed the Tribunal to file a supplementary paper book annexing the chart. Dr. Pal drew our attention to the relevant portion of the supplementary paper book containing the chart wherein averment has been made to the effect that the proposed dividends of Oberoi Hotels (India) Pvt. Ltd. have been considered as liability as those dividends have been declared and approved in Annual General Meeting held before the relevant valuation date (vide page 4 of the supplementary paper book). But it appears from the other pages of the supplementary paper book that in some cases proposed dividend was not treated as liability. Be that. as it may, no material particulars or documents were furnished by the assessee to show that the proposed dividends in question were declared and approved in the Annual General Meeting held before the relevant valuation date. It was argued by Dr. Be that. as it may, no material particulars or documents were furnished by the assessee to show that the proposed dividends in question were declared and approved in the Annual General Meeting held before the relevant valuation date. It was argued by Dr. Pal that since the proposed dividends were declared and approved in the Annual General Meeting held before the relevant valuation date the same ought to be treated liability and this aspect was not considered by the Division Bench in the earlier reference case. It was further contended by Dr. Pal that even though the proposed dividend was correctly shown as the liability but the advance tax also was incorrectly shown as an asset which should not have been taken into account in computing the value of the shares and if the advance tax is not shown as an asset and the proposed dividend is shown as liability the value of the shares will be much less than what has been adopted in the wealth tax assessment. It was further argued by Dr. Pal on behalf of the assessee that the Commissioner of Wealth Tax did not indicate in the show cause notice or even in his order how the provision for taxation was in excess of the liability as per the book profit of the Company and unless there was a finding that what was shown as a liability was in excess of what was the correct tax liability as per the book profit of the company, the amount shown as a liability could not be scaled down. 10. It appears that on perusal of the chart the Tribunal found that the values• adopted by the Wealth Tax Officer in the Wealth-tax assessment were more than the value as per Rule 1D method. It was contended by Dr. Pal that such finding of the Tribunal was a finding of fact and if the value adopted in the Wealth Tax assessment was more than the value as per Rule 1D, then on the face it, the order of the Wealth Tax Officer could not be revised because the order even though erroneous was not prejudicial to the interest of the revenue. He cited the case of (1) Malabar Industrial Co. He cited the case of (1) Malabar Industrial Co. Ltd. v. Commissioner of Income Tax reported in 243 ITR 83 (SC) in support of his contention that the Commissioner can exercise jurisdiction suo motu under Section 263 of the I.T. Act or under Section 25(2) of the Wealth Tax Act if the order of the Assessing Officer sought to be revised is erroneous and it is pre-judicial to the interest of the revenue and if one of the twin conditions is absent recourse cannot be had to Section 263 of the Income Tax Act or Section 25(2) of the Wealth Tax Act. 11. It is evident from the order of the Tribunal that the Tribunal on perusal of the chart or statements, as the case may be, filed by the assessee came to the finding that the cumulative value of the shares of various companies determined by the Assessing Officer was in excess of their value as per the break-up value method. But details contained in the said statements or chart have not been discussed by the Tribunal in its order. Dr. Pal drew our attention to the supplementary paper book containing the chart called for by this Court in terms of the order dated 21.3.2001. But, the relevant documents in support of the said chart have not been produced before us. 12. Mr. Bhowmick appearing for the revenue contended that in the earlier judgment passed by the Division Bench of this Court on 25.4.94 in Matter No. 3791 of 1991 Commissioner of Wealth Tax v. Shri M. S. Oberoi all-the factors were taken into account by the Division Bench of this Court whereupon the substantially identical questions referred for opinion were answered by the Division Bench in favour of the revenue. On going through copy of the judgment passed by the Division Bench of this Court in the said earlier case and the materials-on-record emerging from the facts and circumstances of the instant reference case we find sufficient force in the contentions raised by Mr. Bhowmick on behalf of the revenue. The entire issue centers around the question whether the contentions made on behalf of the assessee that the break-up value arrived at by the Assessing Officer was more than the value to be correctly ascertainable by application of Rule 1D. Bhowmick on behalf of the revenue. The entire issue centers around the question whether the contentions made on behalf of the assessee that the break-up value arrived at by the Assessing Officer was more than the value to be correctly ascertainable by application of Rule 1D. In the earlier case referred to above the Division Bench of this Court examined the very basic premise in the assessees arguments and did not agree that there was any ultimate error in taking the advance tax as asset on the one hand and taking the provision for taxation in full as the liability. The following observation of the Division Bench made in the earlier case is required to be noted in this context:- "Eyen if advance tax is not to be taken as an asset the, gross tax payable before adjustment of the advance tax against the tax payable with reference to the book profits cannot also be taken as liability. In this regard, we take the view that while advance tax is not to be taken as asset, the provision for gross tax payable with reference to book profits without adjustment of the advance tax is not also to be reckoned as a liability. The Rule, of course, requires advance tax not to be taken as an asset, but exclusion of advance tax as an asset necessarily postulates that the tax liability computable as deduction from the net worth of the company should be the net tax liability remaining payable after adjustment of the advance tax against it. The principles of accountancy cannot admit of the proposition that advance tax should be excluded from assets and at once the gross tax liability on the book profit before adjustment of the advance tax should also be included as liability. Therefore, we do not agree with the learned Counsel's contention that there was any error on the part of the Assessing. Officer in taking the advance tax as an asset in so far as he allowed the gross tax liability as provided for in the balance sheet as liability. Again, it cannot be said that pre-paid expenses do not represent any asset. Rule 1D contemplates exclusion of only the fictitious asset, but pre-paid expenses cannot be said to be a fictitious asset. Again, it cannot be said that pre-paid expenses do not represent any asset. Rule 1D contemplates exclusion of only the fictitious asset, but pre-paid expenses cannot be said to be a fictitious asset. It is a tangible asset in the sense that the party who was prepaid is a debtor to the Company which he is to satisfy either by rendering service or delivering goods. It is a real debt receivable. An asset could be fictitious only where it does not represent any quid pro quo. That is not the case in the case of pre-paid expenses. In fact the claim arising from pre-paid expenses is an actionable claim. So, in our view, pre-paid expenses represent an asset to be taken into account for the purpose of computing the net worth of the Company under Rule 1D". The above observation of the Division Bench makes it quite clear that though the Rule requires advance tax is not to be taken into account as an asset, exclusion of advance tax from the ambit of asset necessarily implies that net tax liability remains payable after adjustment of the advance tax against it. In the earlier case the Division Bench did not agree with the contention that there was any error on the part of the Assessing Officer in taking the advance tax as an asset in so far as the gross tax liability as provided for in the balance sheet was allowed by him as liability. 13. In the instant case the Commissioner of Wealth Tax examined the wealth tax records in question relating to the assessment years 1982-83 and 1983-84 and found that items like advance tax and pre-paid expenses were wrongly treated as asset and not deducted from the asset side to arrive at the net asset as required in terms of Rule 1D. The Wealth Tax Officer treated the proposed dividend as liability. It is no doubt settled law that unless there is authoritative declaration of dividend there can be no allowance of liability by way of provision for proposed dividend. It was clearly pointed out by the Division Bench in the earlier reference case. The Wealth Tax Officer treated the proposed dividend as liability. It is no doubt settled law that unless there is authoritative declaration of dividend there can be no allowance of liability by way of provision for proposed dividend. It was clearly pointed out by the Division Bench in the earlier reference case. It is no doubt settled law that the liability for payment of any amount by way of dividend arises only when the share holders accept the recommendations of the directors for payment of any dividend and a dividend is declared at the annual general meeting of the Company. This principle of law was already laid down by the Supreme Court in the case of (2) Vazir Sultan Tobacco Co. Ltd. v. Commissioner of Income Tax, 132 ITR 559. There are no materials-on-record to indicate that the documents relating to acceptance of the recommendations of the directors by the share-holders for payment of the proposed dividends and declaration of such dividends in the annual general meeting of the Company concerned were ever produced by the assessee before the wealth tax authority or before the Tribunal at any point of time nor any such document was produced before us. So the proposed dividends in question cannot create any liability. Furthermore, the assessee was found to have treated the excess provision of tax over the tax liability on book profit as a liability though the same could not be treated as liability. Under such circumstance the commissioner of wealth tax concerned had to pass the orders under Section 25(2) of the Act. The legality and validity of the said order were upheld by the Division Bench of this Court on reference in the earlier case. 14. For the foregoing reasons we are of the view that in the facts and circumstances of the case the Tribunal is not justified in law in holding that the assumption of jurisdiction by the Commissioner of Wealth Tax under Section 25(2) of the Act was not correct nor the Tribunal is justified in holding on the basis of the statement filed by the assessee that the cumulative value of the shares of various companies determined by the Wealth Tax Officer was in excess of their value as per break-up value method when details contained in the statement are not discussed by the Tribunal in its order. Both the questions referred to us for opinion are answered in the negative in favour of the revenue and against the assessee. The instant reference case is disposed of accordingly. There will be no order as to costs. Chatterjee, J. : I agree.