TMI Blog2016 (4) TMI 802X X X X Extracts X X X X X X X X Extracts X X X X ..... Year 1988-89. WTA No. 52 pertains to Assessment Year 1989-90 and WTA No. 53 pertains to Assessment Year 1992-93. All the three appeals have a common issue and they were heard together. Hence, all the three are being disposed by this common order. 2. The facts of the cases are that the assessment in all the three cases was restored to the file of the AO by the Delhi Bench WT-1 of the Tribunal in its order dated 22.6.2004 in WTA Nos. 172,173 and 174/Del/1999 and now aggrieved by the orders of the wealth tax authorities below, this is the second round of litigation before us. The issues involved in the three appeals are as under: WTA 51/Del/2012 3. The assessee company constructed a building on the plot of land taken on lease from Delhi Development Authority at 1, Zamrudpur Community Centre, Kailash Colony, New Delhi. The company let out the building during the year ended 31.3.1988 and received a rent of ₹ 18 lakhs. The original cost of the building including the accessories was ₹ 36.78 lakhs whereas the written down value as at 31.3.1988 was ₹ 28.62 lakhs. The assessee company claimed a deduction of ₹ 5,45,831/- on property tax levied but the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mula could be adopted. The Ld. AR also relied on the decision of the Mumbai WT Bench in the case of Lloyds Realty Ltd. vs. DCIT 90 ITD 710 in support of his contentions. The ground regarding disallowance of property tax was not pressed and the same is dismissed. WTA 52/D/2007 5. The assessee company had let out the building during the year ended 31.3.1989 also and as per the lease agreement, the rent was ₹ 20,20,500/-. The value of the total assets of the company as at 31.3.1989 was ₹ 94,48,028/-. The value of the building was ₹ 27,08,531/-. The total liability was ₹ 91,10,920/-. Accordingly, the debt incurred in connection with the building was calculated as under: Value of the property/total assets x total liability i.e.Rs.27,08,531/Rs.94,48,028 x ₹ 91,10,920 = ₹ 26,11,890 5.1 This addition/disallowance was upheld by the Ld. CWT (A) and the assessee is in appeal contesting the same. The Ld. AR has taken the same plea as in AY 1988-89, however, for the sake of brevity, the same is not being reproduced again. WTA No. 53/D/2007 6. The appellant company let out the building to Projects Development India Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rently, as compared to the value of total assets, the assessee's capital and reserves are meagre and therefore obviously borrowed funds would have been utilized in acquiring the assets. However, the question that does remain is that can an assessee s pro rata claim be allowed in absence of a specific provision in the Wealth Tax Act. In this regard, the judgment of the Hon ble High Court of Madras in the case of CIT vs K.S. Vaidyanathan 153 ITR 11 (Mad.) is very relevant. The relevant paragraphs are 28 to 35 and 59. First their Lordships have discussed at length the extent and the limitations to the interpretation of statutes and later on in Para 59 discussed the issue related to these appeals. These paragraphs are being reproduced for ready reference as under: 28. Let us now take up for consideration the argument of the learned counsel for the assessee that taxing statutes are to be construed strictly and in favour of the assessee. No exception can be taken to the proposition that fiscal statutes should be interpreted strictly and in cases of doubt, the benefit of construction must be given in favour of the assessee. However, this rule applies only to charging sections and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or absurdity which can hardly have been intended, a construction may be put upon it which modifies the meaning of the words and even the structure of the sentence. This may be done by departing from the rules of grammar, by giving an unusual meaning to particular words, or by rejecting them altogether, on the ground that the Legislature could not possibly have intended what its words signify, and that the modifications made are mere corrections of careless language and really give the true meaning. Where the main object and intention of a statute are clear it must not be reduced to a nullity by the draftsman's unskilfulness or ignorance of the law, except in a case of necessity, or the absolute intractability of the language used. Lord Reid has said that he prefers to see a mistake on the part of the draftsman in doing his revision rather than a deliberate attempt to introduce an irrational rule: 'the canons of constructions are not so rigid as to prevent a realistic solution'. Crawford in his Statutory Construction, page 256, has stated the principle thus: Since the Legislature must express its intention by a written statute that intention, in any instanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missing case. As is obvious, to permit the court to supply the omissions in statutes would generally constitute an encroachment upon the field of the Legislature. But, inasmuch as it is the intention of the Legislature which constitutes the law of any statute, and since the primary purpose of construction is to ascertain that intention, such intention should be given effect, even if it necessitates the supplying of omissions, provided, of course, that this effectuates the legislative intention. Some decisions seem to indicate a trend in this direction and allow words omitted by oversight to be supplied, if the statute is otherwise meaningless or if an amendment without interpolation is ineffective. Similarly, a plain misnomer may be corrected, or a statute made intelligible by the addition of a word suggested by the statute. It is proper for the court to supply such omissions because they are in fact a part of the statute, having been intended to be included in the statute when drafted and enacted. 32. to quote Craies on Statute Law, 7th edition, p. 94: If the language of an Act of Parliament is clear and explicit, it must as already stated, receive full effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t remedy Parliament has appointed; and (4) The reason of the remedy'. The reference here is to Heydon's case [1584] 3 Co Rep 7a; 76 ER 637 (A-1). These are principles well settled, and were applied by this court in Bengal Immunity Co. Ltd. v. State of Bihar . To decide the true scope of the present Act, therefore, we must have regard to all such factors as can legitimately be taken into account in ascertaining the intention of the Legislature, such as the history of the legislation and the purpose thereof, the mischief which it intended to suppress and the other provisions of the statute, and construe the language of s. 2(d) of the Prize Competitions Act, 1955, in the light of the indications furnished by them. In CIT v. Indian Bank Ltd. Sikri J. stated the ratio thus (p. 79): In our opinion, in construing the Act, we must adhere closely to the language of the Act. If there is ambiguity in the terms of a provision, recourse must naturally be had to well-established principles of construction but it is not permissible first to create an artificial ambiguity and then try to resolve the ambiguity by resort to some general principle. 34. In Seaford Court Es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sher [1949] 2 All ER 155. We do not sit here to pull the language of Parliament and of Ministers to pieces and make nonsense of it. That is an easy thing to do, and it is a thing to which lawyers are too often prone. We sit here to find out the intention of Parliament and of Ministers and carry it out, and we do this better by filling in the gaps and making sense of the enactment than by opening it up to destructive analysis . XXXX 59. With very great respect, we are unable to subscribe to the view expressed on the basis of the language of s. 2(m)(ii) that there cannot be any apportionment of a debt as in part chargeable and in part not chargeable. In fact, this very theory was not accepted by the Bench in CIT v. Rajam [1982] 133 ITR. That decision proceeded on the basis of the applicability of the doctrine of casus omissus. No doubt, s. 2(m)(ii) does not specifically provide that the apportionment of the debt is secured only when one of the properties is exempted from wealth-tax or as between a portion of the asset which is partially exempt and which is not partially exempt. We have already stated that in such case it is the duty of the court to make a purposive and re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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