TMI Blog2015 (8) TMI 483X X X X Extracts X X X X X X X X Extracts X X X X ..... are as under : 1. On the facts and in the circumstances of the case and in law, the Ld. CWT(A)-II, Nashik has erred in holding that the said properties namely Building No. E, 1st floor, Building No. A F 1st Floor and 2nd Floor of Unity Chambers are not assets as per section 2(ea)(i)(5) the Wealth Tax Act, 1957 without appreciating the fact that the assessee had given different treatment to those assets and converted them from stock in trade to capital asset. 2. On the facts and circumstances of the case and in law, the order of the Ld. CWT(A)-II, Nashik be cancelled on the above issue and that of the A.O. be restored. 3. The appellant craves leave to add, alter, modify, delete amend any of the grounds at any stage of appellate proceedings. 4. The appellant prays to file any of the additional evidence appropriate to the grounds taken in appeal. 3. Facts of the case, in brief, are that the assessee filed his return of wealth on 30-07-2010 disclosing total taxable wealth of ₹ 40,28,900/-. During the course of assessment proceedings the AO noted that the assessee has converted the stock in trade into investment for Building No.E, Ist floor construction account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.1 The facts of this case are that the building in question is known as Unity Chambers . The appellant has let out the building No. E, 1st floor, Unity Chambers, Jalgaon to R.C.F. Ltd. for a rent of ₹ 1,26,225/-. The said company is using the premises for its business. Building No. A 1st and 2nd floor of Unity Chambers, Jalgaon is rented out to the ICFAI Academy for a rent of ₹ 12,76,800/-. The ICFAI Academy is conducting commercial activity of providing commercial knowledge from the premises. Building No. F, 1st 2nd floor of Unity Chambers is rented out to LIC for a rent of ₹ 9,10,164/-. The LIC is using the property for its business. 6.2 The appellant has claimed that it is paying municipal tax to Jalgaon Municipal Council for using the premises for commercial purpose. The appellant has offered the rental income to tax for the year under consideration. The appellant has also furnished copies of lease agreements entered with the said parties. 7. From the perusal of the details furnished by the appellant including lease agreements with the said lessees, it appears that the said properties namely building No. E, 1st floor, building No. A F, 1st floor an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income-tax Act. We find the Ld.CWT(A) allowed the claim of the assessee for non inclusion of the same in the net wealth by following various decisions which has already been reproduced in the preceding paragraphs. We do not find any infirmity in the order of the CWT(A) on this issue. So far as the decision of the Pune Bench of the Tribunal in the case of Nutan Warehousing Co. Pvt. Ltd., (Supra) is concerned we find the Hon ble Bombay High Court vide WTA Nos. 2807,2808,2925,2926,3421/2010 order dated 16-06-2011 has restored the issue to the file of the AO for reconsideration of the issue afresh by observing as under : 2. The question raised in these appeals is, whether ITAT was right in holding that the warehouses used in warehousing business are assets within the definition of 2(ea) of the Wealth Tax Act, 1957. In the income tax proceedings in the assessee s own case, this Court by its decision dated 18-12-2010 reported in 326 ITR 94 (Bom.) remanded back the matter to the assessing officer to consider the question as to whether the income derived by the assessee from warehousing activity was the business income and whether dominant purpose of letting out the warehouse was the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f commercial establishments or complexes . As per the Revenue, the aforesaid properties, though being used for commercial activities, are let out by the assessee. According to the Revenue, the said properties are not being used by the assessee for the purposes of his own business. The Pune Bench of the Tribunal in the case of Satvinder Singh (supra) has observed that in order to cover a case under Explanation (5) below section 2(ea)(i), it is not necessary that the property in the nature of commercial establishment or complex should be occupied by the assessee for the purposes of business or profession carried on by him as was the case in Explanation (3) which excludes any house occupied by the assessee for the purposes of any business or profession carried on by him. For the purposes of applying Explanation (5) to section 2(ea) the nature and use of the property is material. Following the aforesaid precedent, it is clear that in order to evaluate a claim for exclusion based on Explanation (5) to section 2(ea)(i) of the Act, the assessee has to demonstrate that the property is in the nature of commercial establishment or complexes, though the commercial activity may not be carried ..... X X X X Extracts X X X X X X X X Extracts X X X X
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