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TMI Blog2018 (6) TMI 907X X X X Extracts X X X X X X X X Extracts X X X X ..... pening taken recourse by the Assessing Officer as upheld in the lower appellate proceedings. 3. It is evident that the CIT(A)'s order for AY 2008-09 followed in AY 2009- 10 reads as under:- "5.1 I have considered the assessment order and the written submissions filed by the A/R of the appellant. I find that the value of freehold land of Rs. 62,57,09,250/- includes two freehold lands on which Company's building, factory shed and manufacturing units are constructed. Details of such freehold land along with Building, Factory Shed and manufacturing unit are as under:- (1) Freehold land situated at 24, Park Street, magma House, 9th Floor, Kolkata-700 016 (2) 19, Mehta Road, Bare Kalinagar, Budge Budge, 24 Parganas (South). I find that the appellant's registered office is situated at Magma House, 24 Park Street, 9th Floor, Kolkata-700 016 and is being used for business purposes only since long time past and the Book Value of this land as on 31/03/1986 was Rs. 2,14,148/-. This was revalued from time to time and its revalued figure as on 31/03/1986 was Rs. 625.20 lakhs. Apart from this the property of Magma House is a commercial establishment and the appellant is paying corpora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty from which rent was received was not used by the assessee for its business purpose. Therefore, the value of the property was chargeable to wealth tax, as the property was an asset within the meaning of section 2(ea)(ii) of the Wealth-Tax Act, 1957. The AO valued the said property as per Part-B of Schedule-III of the Wealth Tax Act. Thus, it was clear that the assessee was liable to pay wealth tax in respect of net wealth for the assessment year 2006-07, but no return of wealth was filed. Therefore, reasons were recorded and notice under section 17 of the Act was issued on 31st March, 2010. In response to notice under section 17 of the Wealth Tax Act, WTA No.43 /Kol/2014 M/s. Navin Vanijya Pvt. Ltd. 3 1957, return of wealth was filed on 07.05.2010, declaring net wealth of Rs. 'Nil'. While making the addition, the AO assessed the net wealth at Rs. 59,37,500/- under section 17/16(iii) of the Act. Aggrieved, the assessee filed an appeal before the Commissioner of Income-Tax (Appeals), Central-I, Kolkata who has also confirmed the order of the AO, observing the following: "4. The Ld AR appeared for the assessee and challenged the impugned order by making oral and written submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax. The ld. AR for the assessee submitted that the memorandum explaining the provision in the finance No.2 Bill, 1998 under the head "incentives proposed under the Wealth Tax Act", it is clarified that wealth tax is not levied on productive assets. In view of this logic, it is very much clear that wealth tax would also not be levied on such house property from which the assessee is getting rent and the same has been let out by the assessee for a period of 300 days or more. With regard to 1st ground raised by the assessee and assumption of jurisdiction, we find from the records that the ld. AO had not rightly invoked the reopening proceedings as his reason to believe that the wealth tax has escaped assessment from house property belonging to the assessee is not correct. Hence, ground no.1 raised by the assessee is allowed. 4.3 In the result, the ground No.1 raised by the assessee is allowed. 5. Ground No. 2: Commercial complex- whether it is an asset? Ld. AR submitted that it is abundantly clear that those residential properties that have been let out for a period of 300 days in a year, and it is also proposed to exempt commercial establishments and complexes from the ambit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must be of a commercial in nature. The word 'commercial' means something which is used in or related to, a business or a trade. Commercial means relates to or engaged in or used for commerce or trade. The word 'establishment' means an organization, building, construction, shop, store, concern or corporation. Thus; commercial establishment means some kind of place or building or shop or store where business or trade is carried on. The word "complex" means composite, compounded, multiple, manifold, multi-complex or something, composed of or made of many interrelated parts, as for example, a multi-purpose building. Thus, the word 'commercial complex'. means the commercial multi-purpose building composed and made of interrelating parts in contrast to a single commercial establishment. In the case of commercial establishment, it is not necessary that it should be composed of or made of interrelated parts. The Legislature has excluded both commercial establishment as well as commercial complexes from the definition of "asset" for the purpose of chargeability to tax under the Act. Further, the Memorandum explaining the provisions in the Finance No. 2 Bill, 1998, u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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