S. RAGHBIR SINGH v. WEALTH-TAX OFFICER
[Citation -1984-LL-0904-5]

Citation 1984-LL-0904-5
Appellant Name S. RAGHBIR SINGH
Respondent Name WEALTH-TAX OFFICER
Court ITAT
Relevant Act Wealth-tax
Date of Order 04/09/1984
Assessment Year 1977-78
Judgment View Judgment
Keyword Tags land and building method • commercial property • payment of premium • reversionary value • valuation officer • perpetual lease • valuation date • house property • special bench • value of land • capital gain • co-operative • legal heir • tubewell
Bot Summary: Assessee's appeal: The first ground is regarding the valuation of house property at 8 Keeling Road, New Delhi, which the assessee valued at RS. 30,828 and WTO on the basis of valuation officer's report valued it 96 Rs. 9,00,500 which the CWT(A) upheld Property is partly tenanted and partly self occupied. The assessee valued it on the basis of registered valuer's report at Rs. 5,43,905 while WTO on the basis of Valuation Officer's report valued it at RS. 1,2,10,600. The assessee valued it on the basis of registered valuer's report at Rs. 1,84,800 while WTO on the basis of the Valuation Officer's report valued it at RS. 3,28,100. The assessee valued it at RS. 10,719 while WTO on the basis of Valuation Officer's report valued it at Rs. 31,000 on land and building method which valuation was upheld by the CWT. The assessee urges that the property should be valued under r. 188. Land at Shakarpur was valued by the assessee at RS. 4,536 and by WTO at Rs. 15,000 which valuation was upheld by CWT. This land was purchased by the assessee in 1959 jointly with S. Inder Singh for Rs. 14,000 and interest on the said investment was debited in the account books of M/s Raghbir Singh Anokh Singh and part of the property was acquired by the Government for which the assessee received Rs. 19,052 on which he showed profit of Rs. 14,847 in asst. New Delhi which the assessee valued at Rs. 30,000 and WTO on the basis of Valuation Officer's report valued it at Rs. 3,91,400. 30th Jan., 1968 for Rs. 32,000 out of which Rs. 2,000 were received and Rs. 30,000 was outstanding.


RAJENDRA, A. M.: As these are cross appeals by assessee and Revenue, they are disposed of by consolidated order. assessee-individual owns certain immovable properties at Delhi. relevant valuation date is 31st March, 1976. Assessee's appeal: first ground is regarding valuation of house property at 8 Keeling Road, New Delhi, which assessee valued at RS. 30,828 and WTO on basis of valuation officer's report valued it 96 Rs. 9,00,500 which CWT(A) upheld Property is partly tenanted and partly self occupied. CIT (A) rejected assessee's contention for valuation of he said property under r. 188 on ground that said rule was not operative in asst. yr. 1977-78. We, however, following Tribunal Special Bench Delhi's order in Biju Patnaik vs. WTO (1982) 1 SOT 623 (Del) (SB) direct WTO that said property be valued under r. 1BB. WTO while valuing said property in accordance with said decision will keep in mind direction of Tribunal in that case of Shri Biju Patnaik. assessee has 5/14th share in Gurunanak Auto Market, Kashmere Gate Delhi which is commercial property and was let out to 250 tenants. assessee valued it on basis of registered valuer's report at Rs. 5,43,905 while WTO on basis of Valuation Officer's report valued it at RS. 1,2,10,600. CWT (A) valued it at Rs. 6,31,250. CWT (A) observed that net annual rental of entire property had been correctly computed at RS. 1,60,770 and it had been correctly capitalised by applying multiple of 10,003 at RS. 17,67,444. CWT (A) ignored addition made by Valuation Officer for reversionary value. Department has accented CWT (A)'s valuation and only assessee is in appeal. assessee's only contention is that Valuation Officer should have allowed deduction of 1/6th for repairs instead of one month's rent. Reliance is placed on Dina Nath vs. CED (1970) 77 ITR 193 (P & H) which was followed by CWT (A) in Gian Kaur for asst. yr. 1977-78. We accept assessee's contention and direct that property be valued by allowing deduction of 1/6th for repairs out of rental income. Gurunanak Market Extension, Kashmere Gate, Delhi: This is also commercial Property and is extension of Gurunanak market mentioned above. assessee valued it on basis of registered valuer's report at Rs. 1,84,800 while WTO on basis of Valuation Officer's report valued it at RS. 3,28,100. CWT (A) valued it at Rs. 1,79,500 ignoring reversionary value of land. Here, again assessee's submission is as in case of Gurunanak Market that 1/6th for repairs be allowed. We direct accordingly. It is further urged that collection charges be allowed @ 6% as against 3% allowed by Valuation Officer though he had allowed 6% collection charges in Gurunanak Market (supra). Valuation Officer supports it on ground that there are lessor number of tenants in this market as compared to Gurunanak Market. We are, however, unable to see any distinction. We accordingly direct that 6% collection charges be allowed for working out net rent. next controversy is regarding multiple for capitalisation which was adopted by Valuation Officer at 12.492 in respect of this market as against multiple of 10.003 in case of Gurunanak Market. It was pointed out that in case of Smt. Gian Kaur, legal heir of Anokh Singh, ITAT '(D)' Bench Delhi in asst. yr. 1977-78 had applied multiple of 10 times. We note that as per r. 1BB multiple is not 100/9 in respect of let out property we direct that same multiple of 100/9 be adopted as against 12.492 adopted by Valuation Officer and approved by CWT (A). Gurunanak Building, Kashmere Gate, Delhi: This is also commercial property which was valued by assessee at RS. 5.70 lakhs and by WTO on basis of Valuation Officer report at RS. 29.60 lakhs and by CWT (A) at RS. 8.85 lakhs by applying multiple of 12.5 times. assessee's grievance is against said multiple. For reasons given above in respect of Gurunanak Market Extension, we direct that multiple of 100/9 be applied. Mehrauli House: This is residential house. assessee valued it at RS. 10,719 while WTO on basis of Valuation Officer's report valued it at Rs. 31,000 on land and building method which valuation was upheld by CWT (A). assessee urges that property should be valued under r. 188. We direct accordingly. Land at Shakarpur was valued by assessee at RS. 4,536 and by WTO at Rs. 15,000 which valuation was upheld by CWT (A). This land was purchased by assessee in 1959 jointly with S. Inder Singh for Rs. 14,000 and interest on said investment was debited in account books of M/s Raghbir Singh Anokh Singh and part of property was acquired by Government for which assessee received Rs. 19,052 on which he showed profit of Rs. 14,847 in asst. yr. 1971-72. assessee urges that balance land left with assessee is occupied by labourers and, therefore, value shown by at Rs. 4,535 should have been accepted area of land remaining with assessee after acquisition of part of land by Govt. is not indicated. Over last decade with coming up of Govt. servant's Co-operative House Building Societies in Trans-Jamuna colonies value of land of trnas-Jamune land has greatly appreciated. We, therefore, uphold valuation of Rs. 15,000 made by lower authorities. assessee's agricultural land in village Gadardur and village Gadarpur was valued by assessee at Rs. 2,82,720 on basis of registered valuer's report who valued land @ Rs. 3,000 per bigha. WTO on basis of Valuation Officer's report valued said land @ Rs. 10,000 per bigha at Rs. 7.87 lakhs. CWT (A) valued land @ Rs. 5,000 per bigha after considering sale instances mentioned by assessee. CWT (A) thus reduced it to Rs. 3,93,500. Both assessee and Revenue are in appeal. Our observations are same as in respect of Shankerpur land in para 10 above. We accordingly uphold valuation made by CWT (A). assessee urges that tubewell of RS. 6,880. iron gate, barbed wire etc. Rs. 5,000and trees Rs. 46,620 were exempt and should not have been included in net wealth. There is no discussion in CWT (A)'s order in respect of these items and, therefore, this ground does not arise out of CWT (A)'s order. Even otherwise and assessee's claim of exemption of tubewell Rs. 6,000 and iron gate, barbed wire, etc., Rs. 5,000 as exempt under s. 5(1) (xi) as tools and implements for cultivation of agricultural land cannot be accepted. This claim is, therefore, rejected. Regarding trees Rs. 46,620 it is claimed that same were standing on agricultural land and were, therefore, exempt under s. 5(1) (viii) (b). assessment order is silent on location of trees. CWT (A) has not discussed this point. We accordingly restore this matter to WTO to examine assessee's claim on this point. In result assessee's appeal is partly allowed. In Revenue's appeal, ground regarding valuation of agricultural land at village Gadarpur and Gabarpur is dealt by us in para 11 above, where we have upheld valuation by CWT (A). In result, Revenue's ground on this point fails. Revenue's next grievances regarding valuation of plot No. 154, Moti Khan. New Delhi which assessee valued at Rs. 30,000 and WTO on basis of Valuation Officer's report valued it at Rs. 3,91,400. This plot measuring 650 sq. yd. was obtained from DOA on perpetual lease on 12th June, 1963 on payment of premium of Rs. 16,242. Assessee said half of plot to Manna Singh vide agreement dt. 30th Jan., 1968 for Rs. 38,000 and capital gain of Rs. 10,331 was assessed in asst. yr. 1968-69. other half of plot was sold to Gurucharan Lal vide sale agreement dt. 30th Jan., 1968 for Rs. 32,000 out of which Rs. 2,000 were received and Rs. 30,000 was outstanding. assessee valued said half share at Rs. 30,000. Valuation Officer rejected sale on ground that assessee as lessee was neither authorised to sub-divide plot without permission of lesser nor to sale same. He, therefore, on basis of comparable cases valued half plot @ Rs. 1,100 per sq. yd. at Rs. 3,91,480. assessee's contention is that there was no justification for accepting only sale agreement regarding half of plot agreed to be sold to Manna Singh and rejecting assessee's agreement of sale to Gurucharan Lal though facts in respect of both agreements of sale were similar and both purchasers had built on said portions agreed to be sold to them, though no sale agreements had so far been executed. It needs verification, whether Gurcharan lal who had paid only Rs. 2,000 to assessee in respect of agreement of sale dt. 30th Jan., 1968 for 325 sq. yd. had been allowed to built on said share of plot and to remain in possession of same by assessee. Under these circumstances, we would restore matter to ITO to examine matter afresh. In result, departmental appeal is partly allowed. *** S. RAGHBIR SINGH v. WEALTH-TAX OFFICER
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