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2015 (10) TMI 263 - ITAT HYDERABAD

2015 (10) TMI 263 - ITAT HYDERABAD - TMI - Reopening of wealth tax assessment - non declaration of property - ownership dispute - Held that:- though the assessee has disputed his ownership right over the property but he has failed to bring any evidence on record to show that there is any legal dispute with regard to the ownership of the property pending before any Court of law. On the other hand, the documents available on record clearly establish assessee’s ownership over the property. - Additi .....

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31.03.2008 as the conversion of land from agriculture to non-agriculture took place only on 27.01.2009 i.e., in the assessment year 2009-2010 - the land having been classified as agricultural land in the records of the Government for the relevant period and used for agriculture, it cannot be treated as urban land. - No addition - Decided in favor of assessee. - WTA No. 1/Hyd/2015 - Dated:- 24-6-2015 - B. Ramakotaiah, AM And Saktijit Dey, JM For the Petitioner : Mr A V Raghuram For the Respondent .....

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e assessee is an individual. For the assessment year under consideration assessee originally did not file any return of wealth. Subsequently, on the basis of information available on record, A.O. reopened the assessment and issued a notice under section 17 of the Wealth Tax Act calling upon the assessee to submit his return of wealth. In response to the said notice, assessee filed its wealth tax return on 23.07.2012 declaring net wealth of ₹ 1,70,700. During the assessment proceedings, A.O .....

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ery raised by A.O. as to why assessee has not declared the value of flat located at Somajiguda to Wealth Tax, it was submitted by the assessee that the concerned flat is a disputed property and assessee is not in possession over the same. However, as observed by A.O. in the assessment order, the assessee could not produce any documentary evidence to show that legal dispute in respect of the said property existed. The A.O. also referred to the statement of encumbrance of property issued on 03.01. .....

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sessee is not in occupation of the property and there is dispute with regard to the ownership also. Ld. CIT(A), however, did not find merit in the submissions of the assessee. He observed that when the documentary evidences available on record clearly indicate the ownership of the assessee over the property and there is no evidence brought on record by the assessee to show that the property is under adverse possession or any legal dispute is there concerning assessee s ownership right over the p .....

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ownership right over the property but he has failed to bring any evidence on record to show that there is any legal dispute with regard to the ownership of the property pending before any Court of law. On the other hand, the documents available on record clearly establish assessee s ownership over the property. In the aforesaid facts and circumstances, we do not find any infirmity in the order of the Ld. CIT(A) in confirming the addition the addition of ₹ 26,42,000 to the net wealth. 4. In .....

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xplained that the land being a commercial property is exempt under section 2(ea)(1)(v). when the A.O. again enquired whether any commercial structure existed over the said land, the assessee replied in the negative. However, subsequently, the assessee claimed that as the land was not converted into non-agricultural land till 31.03.2008, the land cannot be considered as asset in terms of section 2(ea) of Wealth Tax Act. It was further submitted that as per the provisions of Karnataka Land Revenue .....

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icient to treat it as an asset irrespective of the nature of the land, subject to the restrictions imposed in the definition of "Urban Land" as provided under Wealth Tax Act. Thus, on the above premises, the A.O. held that even if the land situated in an urban area is used for agricultural purpose, still then it will be an asset as per the Wealth Tax Act. Accordingly, treating the land in question as an urban land, the A.O. added the value of such land determined at ₹ 30,60,52,64 .....

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relevant point of time, confirmed the addition made by the Assessing Officer. The Ld. CIT(A) observed that construction over the land was prohibited not because of any legal obligation but because of choice of the assessee to keep it as agricultural land on paper. He observed that in the same vicinity lands are already used for construction. Thus, the Ld. CIT(A) concluded that the land in question being an "Urban Land" as per section 2(ea)(v), it is assessable to wealth tax. 6. The lea .....

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ally to the definition of "Urban Land" as provided under Explanation-1 therein, submitted that by Finance Act, 2013 an amendment to the definition of urban land has been made as per which land classified as agricultural land in the records of the Government and used for agricultural purposes, is excluded from being treated as an urban land. He submitted that since the said amendment is with retrospective effect from 01.04.1993 the same will apply to assessee s case. Therefore, it canno .....

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ords and used for the purpose of agriculture is outside the purview of urban land. Having gone through the facts on record vis-à-vis the relevant statutory provision, we find merit in the submissions of the assessee. At this juncture, it will be appropriate to look into the definition of urban land as find place under Explanation-1 (b) of section 2(ea) which reads as under : "Explanation-1(b) of section 2(ea) : "(b) 'urban land" means land situate- (i) in any area which .....

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municipality or cantonment board referred to in sub-clause (l), as the Central Government may, having regard to the extent of, and scope for, urbanisation of that area and other relevant considerations, specify in this behalf by notification" in the Official Gazette, (but does not include land classified as agricultural land in the records of the Government and used for agricultural purposes or land on which construction of a building] is not permissible under any law for the time being in .....

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