Contact us   Feedback   Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (4) TMI 412 - ITAT DELHI

2016 (4) TMI 412 - ITAT DELHI - TMI - Computation of WDV of the Motor Cars under section 32 or as per rule 20 of the Wealth tax Rules - CIT(A) deleted the addition made by the A.O. in the valuation of the motor cars - Held that:- We agree with the contention of of ld AR that the assessee could not gather the information in respect of the insured value of the vehicles being large number of leased out vehicles. The value of motor cars adopted by the assessee has been upheld by the CWT(A) in view o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sonable and judicious method rather than making a arbitrary estimate by the Assessing officer. The CWT(A) has given a reasoned findings on the issue in dispute and, therefore, no interference is required in his findings on the issue discarding the estimate of debt made by the A.O. and accepting the assessee’s estimate holding it to be scientific without elucidating the reasons for the same.- Decided against revenue - Wealth Tax Appeal No. 29/Del/2014 - Dated:- 24-2-2016 - Sh. I. C. Sudhir, Judic .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rs by ignoring the contradiction in the stand of assessee, viz., giving insured value of motor cars with evidence in A.Y. 1997-98 and pleading impracticability of the same in A.Y. 19998-99. 2. Whether learned Commissioner of Income Tax(Appeals) is right in substituting the WDV method for valuation of motor cars without pointing out any inaccuracy in invoking & application of Rule 20 of the IIIrd Schedule. 3. Whether learned Commissioner of Income Tax(Appeals) is right in discarding the estim .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

The ld Assessing Officer determined the value of Motor Car at ₹ 8,28,77,949 as against value of ₹ 6,92,87,901 declared by the assessee and debt in relation to assets was determined at ₹ 2,00,00,000/- as against Debt of ₹ 5,90,83,620/- declared by the assessee in revised computation of net wealth. Aggrieved with the valuation of motor cars and debt in relation to assets as on valuation date, the assessee filed an appeal before the learned Commissioner of Wealth Tax (Appeal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

debt computed as on valuation date and allowed the relief to the assessee. Aggrieved, the Revenue is before us with the present appeal. 3. In grounds no. 1, the Revenue has raised that the Commissioner of Wealth Tax (Appeals) ignored the contradiction in the stand of the assessee that in assessment year 1997-98, the insured value of motor cars was available and in subsequent year i.e. assessment year 1998-99, the assessee pleaded impracticability of providing the same. In ground No. 2, the Reve .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

fficer and the value declared by the assessee. 3.2 On the other hand, learned Authorized Representative of the assessee agitated that the condition of invoking Rule 20 of IIIrd Schedule of the Wealth Tax was not fulfilled as the market value determined by the AO was not 20% higher than the value declared by the assessee. The learned Authorized Representative also submitted that the Assessing Officer has made an estimate whereas the value worked out by the assessee was based on the evidences and .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e of wealth Tax. The Assessing Officer on the other hand was of view that value of the Motor Cars should be computed as per rule 20 of the Wealth tax Rules , by which the value is to be taken at a price, which it can fetch in the open market on the date of valuation. In last assessment year i.e. AY 1997-98, the assessee took the insured value of the vehicles as value of the motor cars but this year the assessee expressed inability to provide such value, and thus in absence of the such insured va .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

arket value of the vehicle . The relevant findings of the CWT(A) is reproduced as under: 6.3 Schedule III of the Wealth Tax Act contains the Rules for determining the value of assets for the purposes of wealth tax. Rule 20 of the Schedule III of the Act reads as: - (1) The value of any asset/ other than cash/ being an asset which is not covered by rules 3 to 10/ for the purposes of this Act/ shall be estimated to be the price which in the opinion of the Assessing Officer. it would fetch if sold .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

T.V. Sundaram Iyenger and Sons Ltd. 205 CTR 191 (Chennai).The relevant extract of the decision is as under: We heard the arguments. In this case, what is shown in the books was offered for wealth-tax assessments. The AO had merely adopted the insured value of the vehicles as the market value. The AO ought to have determined the market value for each vehicle, instead of merely adopting the value which was offered to the insurance company, as the market value. As to what should be the value of the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

o costs. Consequently, the connected TCMP Nos. 750 to 753 of 2005 are closed. 6.5 On going through the facts of the case, I find that the Appellant, being a NBFC, has large no. of customers with whom leasing has been carried out. Hence, it is impractical for the Appellant to trace the value of each vehicle separately as on the valuation date. The Appellant therefore applied the of the vehicles for the value of motor cars for wealth tax. Moreover, the AO has not indicated any inaccuracy in the va .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

DV of vehicles for taking value for wealth tax purposes. Even the car insurance companies take into account the amount of depreciation for assessing the insured value of vehicles. In view of this, Ground No 1 is allowed in favour of the appellant. 3.4 In view of above, we agree with the contention of of ld AR that the assessee could not gather the information in respect of the insured value of the vehicles being large number of leased out vehicles. The value of motor cars adopted by the assessee .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

le assets. Learned Sr. Departmental Representative submitted that if the assessee failed to bring out the exact amount of the debt corresponding to the motor cars then there was no option with the Assessing Officer except to estimate the debt corresponding to those motors. 4.1 Learned Authorized Representative, on the other hand, submitted that computation of debt by the Assessing Officer at ₹ 2 crores was without any basis as against the debt of ₹ 5,90,83,620/- was based on applying .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s which are used by it for the purpose of business. Given the nature and the quantum of the Appellant's business, the Appellant is in possession of mixed funds through which it transacts its day to day business of leasing and financing. Hence, no direct nexus can be accurately established between the assets purchased by the Appellant with the amount borrowed by it for the purpose of business. In the absence of any clear distinction of funds available with the Appellant, the Appellant had com .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version