TMI Blog2016 (4) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... t:- Looking to the disparity of facts appearing in the submissions of assessee and the orders of lower authorities and also observations of ld. Assessing Officer and ld. CWT(A) that assessee has not been able to prove proper nexus of the vehicle loan taken as well as ECB in regard to the movable and immovable wealth shown in the computation of wealth, it will be proper that the matter arising in this ground of appeal to be restored back to the file of Assessing Officer for fresh adjudication with clear instruction that ld. Assessing Officer will provide sufficient and reasonable opportunity of being heard to the assessee and we also instruct the assessee to produce all necessary documents as discussed above before the Wealth Tax Officer in support of his claim of deduction of debts against the value of taxable assets for wealth tax purposes. Accordingly, this ground is allowed for statistical purposes. - WTA No. 02 /Ahd/2014 - - - Dated:- 18-3-2016 - Shri Rajpal Yadav, JM And Manish Borad, AM For the Appellant : Shri P.M. Mehta, AR For the Respondent : Shri. Narendra Singh, Sr. DR ORDER Per Manish Borad, Accountant Member This appeal of the assessee is di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4) The appellant craves leave to add, amend and/or alter the ground or grounds of appeal either before or at the time of hearing of the appeal. 2. From the above grounds we find that ground nos. 3 4 are general in nature and only two issues first against the action of ld. CWT(A), which is pre-mature, by observing that Assessing Officer has rightly initiated penalty proceedings u/s 17 of the Act and secondly against the action of ld. CWT(A) for not allowing assessee s claim for deduction of liabilities to the extent they had been incurred specifically for acquisition of taxable assets. 3. Briefly stated facts are that the assessee is a limited company engaged in the business of manufacturing and trading of home appliances. During the course of assessment proceedings u/s 16(3) r.w.s. 17 of the Act, from going through the balance sheet of the company for the year ending 31.3.2006 Assessing Officer observed that assessee company owns asset Regency Guest House value of which is ₹ 11,90,790/-. However, no return of wealth was filed by the assessee company and on the basis of satisfaction recorded by his predecessor, Assessing Officer initiated proceedings u/s 17 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment order passed u/s. 143(3) on 26.2.20 Pertinently, during the course of the income-tax assessment proceedings, the learned Assessing Officer had, vide his Notice dated 7.5.2008, raised a specific issue as to whether the appellant was liable to be assessed under the Wealth-tax Act. In this connection, the appellant begs to quote the following portion of its written submissions addressed to the learned Assessing Officer raising objection to the initiation of proceedings u/s. \7 of the Wealth-tax Act, 1957 (emphasis supplied}: 2.1 'During-the course of I.T. assessment proceedings, the assessee company vide notice no ACIT (OSDjR-4/Hitachi/06-07 dated 7fh Mdy,2008 was asked the following in respect of wealth tax liability: {iv} Is the company liable to be assessed under Wealth Tax Act? If yes, submit detail of wealth fax return filed by the company. If no, give detailed submission in this regard. The said notice is attached herewith vide Annexure-1 for your ready reference. In response to the said notice so issued, the assessee company had submitted vide submission dated 14th June, 2008 as under: As (regards the point no. 1((iv) for assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely proved by the fact that even as the appellant's explanation about it not having taxable wealth had been tendered way back in June, 2008 and even as the appellant's assessment for the present assessment year under the Income-tax Act 1961 had been, made vide assessment order passed on 26.2.20IO, the reasons for initiating the proceedings were recorded only on 30.3.20! I and the Notice u/s. 17 of the Wealth-tax Act was served on 31.3.2011 which was the last day for initiating those proceedings In terms of the relevant provisions for limitation under that Act. This apart; it had also been explained that payments for all the motor cars owned by the appellant had been made with borrowed funds as under: [a] By means of specific vehicle loans [b] Balance was paid from the company's borrowal account in the form of cash credits from banks. Thus, once if was appreciated that the entire cost of all vehicles owned by the appellant was made from borrowed funds, it could not even be the Department's case that the appellant had any taxable net wealth in excess of the exemption limit. 3. Unfortunately, however, as will be seen from a copy of communication ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, from procedural point of view the proceedings have been properly initiated and completed. The claim of the appellant that it is a change of opinion is therefore, not accepted and the ground of appeal is dismissed. From going through the submissions of the ld. AR as well as the observations made by ld. CWT(A) we find that assessee company passed through scrutiny assessment u/s 143(3) of the I.T. Act, 1961 and during the course of assessment proceedings ld. Assessing Officer observed that assessee company owns motor cars (vehicles having WDV at ₹ 1.51 cr.) and also assessee company owns Guest House. There was no record available showing that any wealth tax return has ever been filed and in view of these reasons and notice u/s 17 of the W.T. Act was issued and he further found that ld. CWT(A) has accordingly issued proper notice and duly disposing the objection raised by the assessee and had communicated to the assessee. Therefore, we are of the view that ld. CWT(A) has rightly dismissed the ground of assessee in accordance with law. We uphold the same. This ground of assessee is dismissed. 9. Ground no.2 is against the action of ld. CWT(A) confirming the action ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccepted. The appellant has submitted details of loans taken for purchase of vehicles during the course of appellate proceedings and has alternatively claimed that since the borrowings are direct with reference to the assets it should be allowed as deduction for computing the wealth tax. it has shown that for the block of vehicles totaling to Rs, 11246559/- the appellant has taken a loan of ₹ 6014166/-. It has also given copies of the loan statement of various banks in support! of its claim. The claim of the appellant is in order and once it has given the evidences in support of the claim a deduction from the cost of assets shown in the balance sheet should be allowed. Since the evidences were not given before the AO, the AO is directed to verify the claim of the appellant from the documents given and allow the deduction from the wealth. He is accordingly directed to compute the net wealth. The appellant is directed to produce the copies of loan statements of various banks which have been produced before me. The ground of appeal is accordingly, partly allowed. 14. From going through the observations of ld. CWT(A) we find that necessary details showing specific ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
