2013 (3) TMI 781 - AT - Income Tax

Summary

Issues Involved:
1. Legality of ex parte assessment orders u/s 16(5) r.w.s. 17(1) of the Wealth Tax Act.
2. Inclusion of specific lands under the definition of "assets" u/s 2(ea) of the Wealth Tax Act.
3. Rate of valuation for specific plots of land.

Summary:

Issue 1: Legality of Ex Parte Assessment Orders
The assessee challenged the legality of the ex parte assessment completed u/s 16(5) r.w.s. 17(1) of the Wealth Tax Act, arguing that no notice u/s 16(4) was issued and no opportunity of hearing was provided. The Ld.CIT(A) found that the notice issued u/s 16(4) was not a legal notice and concluded that the assessment was null and void due to non-compliance with the mandatory provisions of Section 16(5). The Tribunal concurred, noting that the Assessing Officer did not provide the required opportunity to the assessee before passing the best judgment assessment. Accordingly, Ground No. 1 was dismissed.

Issue 2: Inclusion of Lands as "Assets"
The Ld.CIT(A) held that the land at Survey No. 148/1 and Survey No. 510/A/1 (Part) did not fall within the definition of "asset" u/s 2(ea) of the Wealth Tax Act. The land at Survey No. 148/1 was considered stock-in-trade and agricultural land, thus not an "asset" under the Act. This finding was supported by the decision in the case of Radheshyam R. Jhunjhunwala (HUF), where agricultural land under cultivation was excluded from "urban land" as defined in Section 2(ea). The Tribunal upheld the Ld.CIT(A)'s decision, dismissing Ground No. 2.

Issue 3: Valuation of Plots
The Ld.CIT(A) accepted the valuation rates of Rs. 107/- and Rs. 91/- per Sq.Mtrs. for the lands at Survey No. 101 and Survey No. 510/A/1, respectively, based on evidence of actual sale transactions provided by the assessee. The Tribunal found no reason to interfere with the Ld.CIT(A)'s findings and confirmed the valuation rates. Consequently, Ground No. 3 was dismissed.

Conclusion:
The revenue's appeals were dismissed, and the Tribunal upheld the Ld.CIT(A)'s findings on all grounds. The judgment was pronounced in open court on 26-03-2013.