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2016 (10) TMI 278 - AT - Wealth-taxAsset for the purpose of wealth tax - whether house property which has been let out to a tenant would be outside the ambit of wealth tax under section 2(ea)(i)(v) of the Wealth Tax Act? - Held that:- Considering the submission of assessee that the memorandum explaining the provision in the finance No.2 Bill, 1998 under the head “incentives proposed under the Wealth Tax Act”, it is clarified that wealth tax is not levied on productive assets. In view of this logic, it is very much clear that wealth tax would also not be levied on such house property from which the assessee is getting rent and the same has been let out by the assessee for a period of 300 days or more. With regard to 1st ground raised by the assessee and assumption of jurisdiction, we find from the records that the ld. AO had not rightly invoked the reopening proceedings as his reason to believe that the wealth tax has escaped assessment from house property belonging to the assessee is not correct. Hence, ground no.1 raised by the assessee is allowed. Commercial complex - whether it is an asset? - Held that:- We hold that the subject mentioned property is a commercial complex and is a productive asset deriving rental income of ₹ 15,00,000/- per annum. It is well settled from the Memorandum explaining the provisions in the Finance No. 2, 1998 under the head "incentives proposed under the wealth tax act" that wealth tax is not to be levied on productive assets. We hold that the subject mentioned property shall be exempt u/s 2(ea)(v) of the Act and therefore outside the ambit of taxable wealth. Accordingly, the ground no.2 raised by the assessee in this regard for both the assessment years are allowed.
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