9911796707
TMI Blog1999 (8) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer, i.e., the Assistant Commissioner of Wealth-tax, Bulandshahr, not to proceed with the recovery of the demands created. Counter and rejoinder affidavits, etc., have been exchanged. I have heard Sri Ajit Kumar, Learned counsel for the petitioner, and Sri A. N. Mahajan, learned counsel for the respondents. The petitioner is a wealth-tax assessee and was the owner of the agricultural lands bearing khasra numbers 509, 510, 513, 514, 515, 538, 539 and 540 situate in village Bhoor district Bulandshahr and measuring 23 bighas, 16 biswas pucca, i.e., 71,968 square yards or 60,650 square meters. Up to the assessment year 1988-89, this land was treated as agricultural land and was treated to be exempt from wealth-tax having been excluded from the definition of "asset" by section 2(e)(2)(i)(a) of the Act and the dispute in these writ petitions is whether on the relevant valuation dates, i.e., March 31, 1990, and March 31, 1991, this land ceased to be agricultural land and became an asset as held by the Assessing Officer and the Commissioner. On May 19, 1989, the petitioner entered into an agreement to sell this land to a partnership firm named Konarka Builders constituted by six ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -------------- Twenty three bigha and sixteen biswas pukhta." It was because of this agreement and the subsequent events that the Assessing Officer while making the assessments held that on the relevant valuation dates, i.e., March 31, 1990 and March 31, 1991, the land had lost its character as agricultural land and was, therefore, not excluded from the definition of "asset" in section 2(e) of the Act. The circumstances relied upon by the Assessing Officer for holding that the land in question was no longer agricultural land were (i) the Bulandshahr Khurja Development Authority (for short BKDA) was requested for approval of the colony in the month of June, 1989 ; (ii) on September 29, 1989, a sum of Rs. 3 lakhs was paid by the assessee to the BKDA ; (iii) the firm, Konarka Builders, had paid an instalment of Rs. 2,84,407 on December 30, 1989 to the BKDA ; (iv) the assessee sold Plot No. 119 measuring 176 square metres of this colony on March 19, 1990 ; and (v) in the income-tax return for the assessment year 1990-91, the builders Konarka Builders had shown a sum of Rs. 3,18,451 as sale proceeds of the plots in Hari Enclave the name that was given to the colony to be developed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al land till the year 1991, when the permission to develop the land was accorded by the development authority and a separate agreement dated February 26, 1991, was entered into between the petitioner and the said development authority. It has also been shown by necessary documents annexed earlier to the writ petition that the petitioner continued to remain as the owner of the land and in any view of the matter this was hardly the relevant consideration for the domain whether the land was agricultural or non-agricultural. The law is also clear on this ground that mere agreement to sell does not get absolute right and title in the property in question. II. Because the Commissioner has also not taken into consideration the Circular No.2(WT) of 1968, issued by the Central Board of Direct Taxes in which certain guidelines have been laid down for treating the land as agricultural or non-agricultural. The Commissioner has merely said that the third condition of the said circular that it has not been put to use as non-agricultural land has not been satisfied. The petitioner has already shown that the land retained its character as agricultural land for the relevant assessment years in que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venue is being paid, agricultural operations being carried out and it is being put to non-agricultural purpose on the relevant valuation date. All the three said conditions were satisfied in the petitioner's case, therefore, the land should have been accepted as agricultural. It is settled law, that the circular of the Board is binding on all income-tax authorities including the Commissioner under section 119 of the Income-tax Act. The order passed by the Commissioner is perverse and based on irrelevant and extraneous considerations and as such is liable to be quashed by this court. VII. Because it may be relevant to mention here that after the passing of these orders a heavy demand has been created against the petitioner by respondent No. 2 to the present writ petition. VIII. Because a bare perusal of the order passed under section 18(1)(c) of the Wealth-tax Act would show that the Assessing Officer had not at all applied his mind as to whether penalty would have been levied in this case or not. He has also not discussed anything as to whether any concealment was there on the part of the assessee. The entire order is arbitrary and based on conjectures and surmises. It would not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l are not supported by any evidence the High Court would be justified in setting aside the findings. Similarly, in State of U. P. v. Maharaja Dharmander Prasad Singh, AIR 1989 SC 997, it was held that judicial review under article 226 cannot be converted into an appeal and judicial review is directed not against the decision but is confined to examination of the decision making process. Therefore, the jurisdiction under article 226 of the Constitution of India is very limited and this court can only interfere with the order if it is found that the finding of fact recorded by the authorities below is based on no evidence or is based on an irrelevant consideration. In CIT v. Siddharth J. Desai [1983] 139 ITR 628, a Division Bench of the Gujarat High Court considered the matter and held that the following factors are useful for deciding whether a particular land was agricultural land or not : "(1) Whether the land was classified in the revenue records as agricultural and whether it was subject to the payment of land revenue ? (2) Whether the land was actually or ordinarily used for agricultural purposes at or about the relevant time ? (3) Whether such user of the land was for a lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we may consider the various circumstances appearing for and against the appellant's case. The facts in their favour are : the land being registered as agricultural land in the revenue records ; payment of land revenue in respect thereof till the year 1968-69 ; absence of any evidence that it was put to any non-agricultural use by the appellants ; that the land was actually cultivated till and including the agricultural year 1964-65 ; that there were agricultural lands abutting the said land and that the appellants had no other source of income except the income from the said land. As against the above facts, the facts appearing against their case are : the land was situated within the municipal limits---it was situated at a distance of one kilometre from the Surat railway station ; the land was not being cultivated from the year 1965-66, until it was sold in 1969 ; the appellants had entered into an agreement with a housing co-operative society to sell the said land for avowed non-agricultural purposes, namely construction of houses ; they had applied in June, 1968, and March, 1969, for permission to sell the said land for non-agricultural purposes under section 63 of the Bombay T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s condition, nor anything in the evidence to indicate the intention of its owners or possessors so as to connect it with an agricultural purpose, the land could not be "agricultural land" for the purposes of earning an exemption under the Act and entries in revenue records are, however, good prima facie evidence. Learned counsel for the petitioner also made reference to CIT v. Gemini Pictures Circuit Private Limited [1996] 220 ITR 43 (SC), in which a piece of land situated on the busiest road within the limits of municipal corporation and was registered as urban land in the municipal records and surrounded by commercial buildings and neither seller nor purchaser thereof considering it as agricultural land could not be treated as agricultural land merely because vegetables were being raised therein at the time of sale. As is evident, from a perusal of various authorities cited above, there are various considerations which affect the nature of the land and every case depends on its own facts. Further, the jurisdiction of the High Court under article 226 of the Constitution of India, with regard to a finding of fact is extremely limited and the subordinate authorities' finding cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the petitioner agitates now do not seem to have been pressed and placed before the Commissioner and it seems that the petitioner acted in a very perfunctory manner in preferring and placing the revision petition before the Commissioner. An agreement to sell this property for development as house sites, roads, parks, etc., had been executed on May 19, 1989, i.e., much before the valuation date, i.e., March 31, 1990. Application for approval of a lay out plan had been moved on August 9, 1989, before the development authority. Sums of Rs. 3 lakhs and Rs. 3,18,451 had also been paid to the development authority and even one Plot No. 119 measuring 176 sq. metres had been sold. During the next year, the land to the extent of 3,846.73 metres had also been sold. As held in CWT v.Officer-in-charge (Court of Wards) [1976] 105 ITR 133 (SC), if there is neither anything in its condition nor anything in the evidence to indicate the intention of its owners or possessors so as to connect it with an agricultural purpose the land could not be agricultural land for the purposes of earning an exemption under the Act. Similarly, in Sarifabibi Mohammed Ibrahim's case [1993] 204 ITR 631 (SC), where a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . By diverting the legal route by withdrawing the first appeal and by choosing a restricted remedy, in the form of a revision petition, the petitioner denied himself the benefit of the wider appellate jurisdiction and a finding of the Tribunal on the question under consideration. Further, the petitioner admittedly, had some other lands as well and, lastly, as stated above, a writ petition cannot be heard like an appeal and evidence that was not before the authorities below cannot be allowed to be put in. Learned counsel for the petitioner also referred to the definition of urban land as contained in section 2(o) of the Urban Land (Ceiling and Regulation) Act, 1976. This has no relevance because it is admitted by the Revenue that till May 19, 1989, the land was agricultural land and it changed its character only thereafter. As is mentioned in the agreement it was a grove land and the buyer had been authorised to cut the trees. The cutting of the trees was a material circumstance and the petitioner does not even seem to allege that not a single tree was felled in pursuance of the agreement before March 31, 1990 and March 31, 1991, and explain how Plot No. 119 could be sold without a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of development and supervision charges from the value as calculated above. The net wealth would be Rs. 2,06,06,563 and the assessee would get a relief of Rs. 5,46,187 (Rs. 3,68,302 + Rs. 1,77,805) in the assessment year 1990-91. Similarly, the assessee has 56,768 sq. metres of land as on March 31, 1991. Taking the said circle rate, the value would be Rs. 1,98,68,044. Deducting therefrom the development charges and supervision charges, payable by the assessee amounting to Rs. 5,46,187 the net value would come to Rs. 1,93,22,707 and the assessee would get a relief of Rs. 5,46,187. The contention of the assessee that its value be taken at which it sold land to Konarka Builders is not acceptable as the assessee's wife, Smt. Sarla Rani, is a partner in Konarka Builders and price fixed is a mutual adjustment." As is evident, the petitioner had agreed to sell the land to Konarka Builders for Rs. 1,04,28,000. This was the total consideration that he was to receive in respect of this land in respect of which he was obliged to execute the sale deed as and when required by Konarka Builders in favour of any person whatsoever. It was the right of the builders to prepare a plan and to sell th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
