WT Appeal Nos. 258 and 259 (Nag.) of 1983 are by Prem Raj Gupta, HUF, and they relate to assessment years 1977-78 and 1978-79. WT Appeal No. 260 (Nag.) of 1983 relating to assessment year 1978-79 is by Prem Raj Gupta, individual. WT Appeal No. 150 (Nag.) of 1983 relating to assessment year 1977-78 is by revenue against order of AAC in his Appeal No. 10--WT--Cir. III (4) of 1982-83 dated 16-3-1983 and Cross-objection No. 58 (Nag.) of 1983 is by assessee. appeals filed by HUF as well as individual arise out of orders of AAC in his Appeal Nos. 9--WT--Cir. III (4) of 1982-83 dated 17-9-1983, 1--WT--Cir. III (4) of 1983-84 dated 19-9-1983 and 1-A WT--Cir. III (4) of 1983-84 dated 17-9-1983. As common question is involved in all these appeals, they are disposed of by this common order. question for consideration in all these appeals is, whether assessee, both in his capacity as HUF as well as individual, is entitled to claim that respective shares owned by HUF and individual in property at 20, Barakhambha Road, New Delhi, used exclusively for residential purposes, should be valued as per provisions of section 7(4) of Wealth-tax Act 1957 ('the Act'). There are certain other grounds relating to non-application of rule 1BB of Wealth-tax Rules 1957 (' Rules ') while valuing residential properties as also non-acceptance of report of Valuation Officer to whom reference was made under section 16A of Act. facts in this regard are briefly as under. 2. assessee in its capacity as HUF owned one-third share in property at 20, Barakhamba Road, New Delhi, during previous year relevant to assessment year 1977-78. Its share in same property during previous year relevant to assessment year 1978-79 was one-ninth. assessee has in his capacity as individual also owned one-thirty-sixth share of same property during previous years relevant to assessment years 1977-78 and 1978-79. value of one-third share of assessee HUF, in this property was shown at Rs. 1,69,800 in wealth-tax returns filed for 1977-78 and 1978-79. In case of individual, value or one-thirty-sixth share was shown at Rs. 42,450 for both years in returns filed for 1977-78 and 1978- 79. assessee claimed before WTO during course of assessment proceedings, that this property should be valued according to provisions of sub-section (4) of section 7 or, in other words, that its value should be pegged at value of property as on valuation date relevant for assessment year 1971-72, as portions of house belonging to assessee, both as individual as well as HUF, were exclusively meant and as well as used for residential purposes. It was submitted that though karta and his family were residing at Nagpur, they resided in portions of house belonging to them, whenever they happened to go to Delhi during course of year, and as such, property in question was exclusively meant for residential use. It was also submitted that property was never used for any other purpose, meaning, that it was not put to any commercial use. WTO negatived this contention on ground that what section 7(4) required was exclusive user of property for residential purposes throughout period of 12 months immediately preceding valuation date, and inasmuch as, assessee had only occasionally used property for such purposes on his visits to Delhi, main requirement of section of exclusive user for 12 months was not satisfied. He tried to strengthen this argument by referring to fact that in income-tax return filed for assessment year 1978-79, annual letting value of assessee's share in property was shown at nil, thereby tacitly admitting that house was not actually occupied during previous year concerned. He, therefore, proceeded to value assessee's share in property, without allowing benefit of provisions of section 7(4). While doing so, he noticed that agreement of sale was entered into for sale of property during accounting year relevant for assessment year 1978-79 and on basis of same, he determined value of HUF's one-third share in property at Rs. 13,50,000 for 1977- 78 and Rs. 13,08,297 for 1978-79. Similarly, in case of individual for 1977-78, he determined value of one-thirty-sixth share at Rs. 6,50,000. For 1978-79, value of such share was determined at Rs. 6,54,148. He adopted above values, both in respect of individual as well as HUF, despite fact that reference was made to Valuation Officer under section 16A and Valuation Officer had proposed lower valuations in respect of shares of assessees. reason given by him for ignoring values proposed by Valuation Officer was that Valuation Officer had, while valuing respective shares of assessees in property, had applied provisions of section 7(4) and thereby exceeded powers vested in him for purpose of valuation under section 16A. 3. Aggrieved with valuations taken by WTO, both in respect of individual as also HUF, appeals were preferred before AAC. appeals relating to HUF for both years as well as appeal relating to individual for assessment year 1978-79 were decided by AAC on 19-9- 1983 and he confirmed orders of WTO in all these cases. appeal relating to individual for 1977-78 was decided by his predecessor on 16-3- 1983 by upholding right of assessee for freezing value of property i n question under section 7(4) at its value relevant for assessment year 1971-72. 4. department being aggrieved with AAC's order relating to assessment year 1977-78 in case of individual has filed appeal before us. In cross-objection filed by assessee, apart from supporting order of AAC in this behalf, assessee has contended that AAC had failed to consider and decide ground taken before him, namely, that rule 1BB should have been applied in valuing residential property. assessee has filed appeals against AAC's orders relating to assessment years 1977-78 and 1978-79 in respect of HUF and relating to assessment year 1978-79 in respect of individual. contentions taken in all these appeals are common, namely, that provisions of section 7(4) should have been applied for freezing value of property at its value for assessment year 1971- 72 and also that while ascertaining same, provisions of rule 1BB should also be taken into consideration. 5. AAC, who decided appeals of HUF for 1977-78 and 1978-79 and that of individual for 1978-79, negatived claim of assessee in this behalf for following reasons. According to him, no portion of house was earmarked separately or distinctly for assessee or any other person having interest in house and as house was still used jointly by all members of erstwhile HUF, though for residential purposes, requirement of Explanation to section 7(4) namely, that house includes part of house, being independent residential unit, was not satisfied. He held that house was incapable of division into independent residential units. As regards valuation, he held that sale agreement concluded during accounting year relevant to assessment year 1978-79 clinched issue in this behalf, inasmuch as, sale value as per agreement would represent market value of property in question. AAC, who decided appeal in case of individual for 1977-78, agreed with assessee that liberal Interpretation should be placed on section 7(4) so as to include within its purview even constructive user of property, as long as same was not put to any commercial use. 6. Shri Bahri, appearing for assessee, made following submissions before us. He mentioned that property in question as well as assessee's share therein were exclusively meant for residential use, whenever assessee visited Delhi. He submitted that while applying this section, literal interpretation of words used therein should not lead to denial of exemption allowed under this section, if it is found that property in question is genuinely meant for residential use and in fact same was not put to any commercial use. In this connection, he submitted that beneficial valuation allowed under this section would extend even to properties which are meant for residential use, though they may not be actually occupied throughout previous year. He submitted that on parallel of section 5(1)(iv) of Act prior to its amendment with effect from 1-4-1972 which has been liberally interpreted by various High Courts, this section also should be given liberal interpretation, so as not to exclude genuine cases. In support, he referred to number of decisions of various High Courts, some of which are referred to hereunder: In CWT v. Mrs. Avtar Mohan Singh [1972] 83 ITR 52, while interpreting words for residential purposes in section 5(1)(iv), Delhi High Court held, that what is essential is that property should not be used for non-residential purposes such as commercial purposes and, secondly, that house should be used by assessee solely as residence and not with view to making any profit. In CWT v. B.M. Bhandari [1980] 123 ITR 554 Andhra Pradesh High Court held, that section 5(1)(iv) should be interpreted pragmatically, fairly and reasonably and not in pedantic sense. They further held, that unless assessee has let out house or used house for any other commercial purpose, it cannot be said that house was not exclusively used for residential purposes. In CWT v. Smt. Vimlabai Kantilal Porwal [1983] 141 ITR 484 Madhya Pradesh High Court held, that exemption under section 5(1)(iv) was available even in respect of share of property held by assessee as tenant-in- common. Last but not least, our attention was also invited to decision of Tribunal, Cochin Bench in H.H. Gouri Lakshmi Bayi v. WTO [1984] 7 ITD 548 which is directly on issue in question namely, whether continuous residence of 12 months in property in question is necessary for claiming beneficial effect of section 7(4). Tribunal held, that what was required was only, that house should be intended for residence of assessee and should not have been let out or given out for residence of somebody else. 7. departmental Representative made following submissions. assessee was not using property throughout year. Section 7(4) by specific mention requires, that property should have been used for residential purposes throughout period of 12 months. Plain reading of words of section 7(4) would indicate, that continuous use for period of 12 months is necessary in this context. Words used in statute, not being used without purpose, should be given their logical meaning. Analogy of interpretations relating to section 5(1)(iv) of 1957 Act and section 23 of Income-tax Act, 1961 are not apposite inasmuch as, part user is permitted under those sections whereas section 7(4) specifically requires user for residential purposes for 12 months. residential portion of house has not been demarcated and is not capable of such demarcation. Though Explanation to section 7(4) enlarges scope so as to include part of house but, however, its effect is restrictive inasmuch as, part of house should be independent residential unit. Our attention was also invited to certain observations at bottom of page 485 in Three New Taxes of Sampath Iyengar 5th edn. All decisions cited by assessee relate to interpretation of section 5(1)(iv) whereas under section 7(4) active user for residential purposes for 12 months is absolute must. 8. We have carefully considered arguments on either side. Our decision in this case has been made simple for us in view of decision of Tribunal, Cochin Bench in H.H. Gouri Lakshmi Bayi's case with which we are in full agreement. Under identical facts and circumstances, Bench has held that t h e provisions of section 7(4) would be applicable even in cases where property may not have been occupied by owner for entire period of 12 months. In that case, assessee had share in residential palace but, however, she resided there only on special occasions during year as she was obliged to stay mainly with her husband, who owned palace of his own. house was, however, not used for any other purposes. WTO rejected claim to freeze value of house as, on 1-4-1971 under provisions of section 7(4) for reason that she had not resided in house throughout period of 12 months. On appeal, Tribunal held as follows: " It is not correct to give too literal interpretation to section 7(4) as otherwise, result will be that benefit could be claimed only if assessee resided in house for whole of 12 months and may lose benefit if he is absent from house even for single day. Further, proviso to sub-section (4) shows that assessee can have two residential houses and in that case, he can choose one of residential houses for benefit of sub-section (4). It is clear that in such cases assessee would not have been actually residing in both houses. situation may arise where assessee is hospitalised for entire period of 12 months immediately preceding valuation date and that he could not actually reside in house during this period. Similarly, assessee may be compelled to go and reside with his children or close relatives due to unavoidable reasons. requirement of section seems to be that house should be intended for residence of assessee and should not have been rented out or given out for residence of somebody else. lower authorities were, therefore, not justified in rejecting assessee's claim." In present case also, it is not disputed by department that house at Delhi was not put to any commercial use. portions owned by assessees were admittedly meant for their residential use whenever they visited Delhi. Following rationale of above mentioned decision of Tribunal, w e uphold claim of assessee for freezing value of house as relevant to assessment year 1971-72 under section 7(4). 9. As regards other claim of assessee that rule 1BB should have been applied, we uphold claim of assessee in this behalf, as properties which are wholly or mainly used for residential purposes should be valued as per t h e provisions of this rule. Relying on decision of Delhi Bench ' ' (Special Bench) of Tribunal in Biju Patnaik v. WTO [1982] 1 SOT 623, we direct that this rule should be applied while ascertaining value of this property as applicable for assessment year 1971-72 under provisions of section 7(4). 10. appeal filed by department in WT Appeal No. 150 (Nag.) of 1983 is dismissed. cross-objection of assessee for this year as well as appeals filed by assessee relating to assessment years 1977-78 and 1978-79 in respect of HUF and that by individual for assessment year 1978-79 are allowed. *** PREM RAJ GUPTA (HUF) v. WEALTH-TAX OFFICER