WEALTH-TAX OFFICER v. EXECUTOR OF THE WILL OF LATE SMT. INDRAMANI SINGHANIA
[Citation -1986-LL-1017-9]

Citation 1986-LL-1017-9
Appellant Name WEALTH-TAX OFFICER
Respondent Name EXECUTOR OF THE WILL OF LATE SMT. INDRAMANI SINGHANIA
Court ITAT
Relevant Act Wealth-tax
Date of Order 17/10/1986
Assessment Year 1970-71, 1978-79
Judgment View Judgment
Keyword Tags rent capitalisation method • reversionary value of land • land and building method • procedural in nature • valuation officer • erroneous in law • special bench
Bot Summary: The AAC placed reliance on the decision in the case of Smt. Ashima Sinha and deleted the addition made on account of t h e reversionary value of land. We fully agree with the finding of the AAC where he had deleted the reversionary value of the land by placing reliance on the decision in the case of Smt. Ashima Sinha. The Departmental Representative, at the very out set, contended before us that this rule came on the statute book on 1st April, 1979 and, as such, it was not applicable to the pending proceedings prior to 1st April, 1979 and therefore, the AAC was not at all justified in reversing the finding of the WTO. On the other hand, the Authorised Representative for the assessee kly placed reliance on the order of the AAC and contended that the finding of the AAC is based on the Special Bench decision in the case of Biju Patnaik vs. WTA No. 614 to 624 and 703 to 717 dt. The Departmental Representative contended before us that the order of AAC regarding exemption under s. 5(1)(iv) is erroneous in law and facts of the case so far as the asst. The Departmental Representative contended before us that the AAC was incorrect in giving exemption to the assessee in respect of property No, 22/137, Chatai Mohal, Kangur under s. 7(4) of the WT Act for the reason that the assessee died on 25th Oct., 1953 and the executor of the will was living in a rented house. The Departmental Representative kly placed reliance on the order of the WTO and contended before us that the finding of the AAC should be reversed and that of the WTO should be restored. Since the assessee had already opted for the relief in regard to property No. 22/137, Chatai Mohal, Kanpur as contemplated under r. 1BB of the WT Rules, the AAC was not at all justified in directing the WTO to freeze the value as determined by the Valuation Officer as on 1st April, 1971 for the asst.


Since some common points are involved in all these appeals, they are consolidated, taken up together and are disposed of by this common order for sake of convenience. first common dispute in all these appeals is whether AAC was justified in deleting additions made by WTO on account of reversionary value of land. WTO made addition on account of reversionary value in respect of valuation of properties No. 22/136 and 22/ 137, Chatai Mohal Kanpur. There is no dispute that both these properties are partially let out and partially in self occupation of assessee. In respect of let out portion of property, rent capitalisation method had been adopted by Valuation Officer and so far as self occupied portion is concerned land and building method had been adopted. WTO made separate addition on account of reversionary value of land. On appeal, it was argued before AAC on basis of decision in case of CIT vs. Smt. Ashima Sinha (1979) 116 ITR 26 (Cal) that no separate addition on account of reversionary value of land could be made. AAC placed reliance on decision in case of Smt. Ashima Sinha (supra) and deleted addition made on account of t h e reversionary value of land. Departmental Representative contended before us that Tribunal in case of P.K. Bajpaie (HUF) vs. WTO (1984) 71 ITD 913 (Cal) had held that reversionary value of land is to be included so for as wealth of assessee is concerned. On other hand, Authorised Representative for assessee kly placed reliance on order of AAC and contended that decision relied upon by Departmental Representative was distinguishable on facts. He reiterated same submissions, which were made before AAC and again placed reliance on decision in case of Smt, Ashima Sinha (supra). We have considered submissions of parties and have gone through material on record as well as decisions in cases of CIT vs. Smt. Ashima Sinha (supra) and P.K. Bajpaie (HUF) vs. WTO (supra). We agree with t h e submission of Authorised Representative for assessee that decision of Tribunal in case of Shri P.K. Bajpaie (HUF) (supra) is distinguishable and further more decision of Calcutta High Court in case of Smt. Ashima Sinha (supra) is directly on point. Therefore, we fully agree with finding of AAC where he had deleted reversionary value of land by placing reliance on decision in case of Smt. Ashima Sinha. finding of AAC in this regard is hereby confirmed. next common dispute in all these appeals is whether AAC was justified in accepting assessees claim for valuation of self-occupied portion of house No. 22/136 and 22/137, Chatai Mohal Kanpur as per provisions of r. 1BB of WT Rules. Departmental Representative, at very out set, contended before us that this rule came on statute book on 1st April, 1979 and, as such, it was not applicable to pending proceedings prior to 1st April, 1979 and therefore, AAC was not at all justified in reversing finding of WTO. On other hand, Authorised Representative for assessee kly placed reliance on order of AAC and contended that finding of AAC is based on Special Bench decision in case of Biju Patnaik vs. WTA No. 614 to 624 and 703 to 717 (Del/4/1979) dt. 17th Feb., 1981. In case it was held that rule 1BB of WT Rules is procedural in nature and it is mandatory and is applicable to all pending proceedings. We have considered submissions of parties and in our opinion, case is covered by Special Bench decision in case of Biju Patnaik (supra) and we accordingly agree with submission of Authorised Representative for assessee and uphold finding of AAC on this point. next common point in dispute for asst. yrs. 1970-71 and 1971-72 is whether AAC was justified in holding that exemption under s. 5(1) (iv) of WT Act was available to assessee in respect of house No. 84/60, warganj, Kanpur. Departmental Representative contended before us that order of AAC regarding exemption under s. 5(1)(iv) is erroneous in law and facts of case so far as asst. yrs. 1970-71 and 1971-72 are concerned. It was next contended that exemption under s. 5(1)(iv) was available in respect of house which was being used by assessee for his self-residence, while in this case Smt. Indramani Singhania died on 25th Oct., 1953 and house was not in self-occupation of its assessee. It was further contended that neither executor nor beneficiaries were in possession of property of assessee. Therefore, exemption was wrongly allowed by AAC. assessee. Therefore, exemption was wrongly allowed by AAC. Departmental Representative further contended that executor was residing in rented house. On other hand, Authorised Representative for assessee contended before us that Departmental Representative had taken fresh ground before Hon'ble Tribunal because WTO had himself allowed relief under s. 5(1)(iv), but value of that property was less than Rs. 1 lac. According to him, therefore, AAC had only upheld finding of WTO, but he had directed WTO to allow exemption in respect of property No. 84/60, Anwargani Kanpur in place of 22/136 Chatai Mohal, Kanpur whose value was less than Rs. 1 lac. It was next contended by Authorised Representative that it is not case of Department that house was not used for residential purposes either by Executor or by beneficiary and, therefore, Departmental Representative could not take new stand altogether before Tribunal. We have considered submissions of parties. We agree with submissions of Authorised Representative for assessee that WTO himself allowed exemptions under s. 5(1)(iv) in respect of property No. 22/136, Chatai Mohal Kanpur, but its value was less than Rs. 1 lac. Therefore, AAC had only directed WTO to allow exemption in respect of property No. 84/60, Anwarganj Kanpur. This finding of AAC, in our opinion, is perfectly in order. We also do not subscribe to view of Departmental Representative that neither executor nor beneficiaries were in possession of property left by deceased. Further more, Departmental Representative cannot take fresh plan before us that executor was not using premises for residential premises and, therefore, we are fully satisfied that provisions of s. (5)(iv) are attracted in this case and assessee was entitled to exemption thereunder. finding of AAC in this regard is hereby confirmed. last common point in respect of asst. yrs. 1976-77, 1977-78 and 1978-79 in dispute is whether AAC was justified in holding that house No. 22/137, Chatai Mohal, Kanpur is self occupied property of assessee, and hence provisions of s. 7(4) of WT Act were applicable. Departmental Representative contended before us that AAC was incorrect in giving exemption to assessee in respect of property No, 22/137, Chatai Mohal, Kangur under s. 7(4) of WT Act for reason that assessee died on 25th Oct., 1953 and executor of will was living in rented house (No. 55/56, Kahookothi, Kanpur). Departmental Representative kly placed reliance on order of WTO and contended before us that finding of AAC should be reversed and that of WTO should be restored. On other hand, Authorised Representative for assessee kly placed reliance on order of AAC. We have considered submissions of parties and orders of authorities below. As already noted in earlier paragraphs, assessee claimed that valuation of house No. 22/137, Chatai Mohal, Kanpur should be made in accordance with provisions of 1BB of Wt Rules and order of AAC in this regard was upheld. Thus, assessee has already availed benefit o f r. 1BB. It is not clear from orders of authorities below that assessee did exercise option as available under s. 7(4) of WT Act. Therefore, both reliefs as contemplated under s. 7(4) of Act and r. 1BB of Rules are not available to assessee. Since assessee had already opted for relief in regard to property No. 22/137, Chatai Mohal, Kanpur as contemplated under r. 1BB of WT Rules, AAC was not at all justified in directing WTO to freeze value as determined by Valuation Officer as on 1st April, 1971 for asst. yr. 1976-77 onwards. finding of AAC, in our opinion, is erroneous in this regard and same is hereby reversed. In result, WTA Nos. 36, 37, 38, 39, 40, 41 (Alld), /1984 are dismissed. While WTA nos. 42, 43 and 44 (Alld.)/ 1984 are partly allowed. *** WEALTH-TAX OFFICER v. EXECUTOR OF WILL OF LATE SMT. INDRAMANI SINGHANIA
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