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2016 (5) TMI 1056 - AT - Wealth-taxScope of Assets u/s 2(ea) of Wealth Tax Act, 1957 - inclusion of residential building let out and only for brief period the property was vacant - Letting out period is less than 300 days - Held that:- It could be appreciated that the ‘asset’ which was taxed u/s 2(ea)(i) of the Act was legally in existence only for a period of 92 days during FY 2005-06. In the circumstances, it was not possible to let the said property for period of at least 300 days in FY 2005-06 so as to qualify for exemption provided in section 2(ea)(i)(4) of the Act. In view of the aforesaid findings and adopting purposive interpretation of the legal provisions of the Act in consonance with the Explanatory Memorandum to Finance (No.2) Bill, 1998 , residential property let out being a productive asset, we deem it fit to grant benefit of exemption envisaged by clause (4) since for the entire duration of the previous year during which the property was in legal existence, was let for residential purposes. The subject mentioned property which has been let out would not fall within the ambit of taxable asset u/s 2(ea) of the Act - Decided in favor of assessee. Inclusion of jewellery without giving effect to debts owed in relation to jewellery - Held that:- During the year in which Jewellery was owned, there was no increase in share capital and reserves and surplus during those relevant assessment years - on the contrary, we find that the loan funds have increased - which enables us to safely conclude that the jewelleries have been obtained only out of borrowed funds and hence the same requires to be deducted from the value of jewelleries. - No addition. - Decided in favor of assessee. Valuation of motor Cars - Held that:- 80% of the insurance value of motor car should be considered as the market value in terms of Rule 20 of Schedule III of Wealth Tax Act. - Decided in favor of assessee.
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