TMI Blog1991 (12) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... Building'?" The facts giving rise to the above reference being made to this court are that Wenger's Building was purchased by the firm, Wenger and Company, from Dayal Singh Trust Society and Shri Mool Chand Kharaiti Ram Trust, vide sale deeds dated March 9, 1962, and September 28, 1963, for Rs. 3,90,000 and Rs. 1,50,000, respectively. The total consideration thus comes to Rs. 5,40,000. The building was constructed some time during the year 1930 on a plot of land measuring 1051 sq. yds. having two storeys. Before the purchase, M/s. Wenger and Co. was occupying a part of the said building as a tenant and in fact had been running its business therein since long. The firm was paying a rent of Rs. 1,195 per month to the landlord. Besides the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the amount added on account of reversionary value of the property. The Revenue appealed to the Tribunal saying that the inclusion of the reversionary value of the land was fully justified. The Tribunal held against the Revenue which has led to the present reference being made. It is not disputed that the property in question is covered by the provisions of the Delhi Rent Control Act. It is also not disputed that there are tenants in the property, though a part thereof is in the occupation of the assessees. These factors have an important bearing on the value of the property. This court has recognised the effect of such impediments on the valuation of a property in CIT v. New India Construction Co. [1980] 123 ITR 68. It was observed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment of the Calcutta High Court in CIT v. Ashima Sinha [1979] 116 ITR 26. It has been held in the said judgment that if a statutory control is imposed on a commodity restricting the price or transfer or distribution of the same, then the commodity ceases to be a commercial commodity as understood in common parlance and becomes a controlled commodity and its effective value is its controlled value and not an imaginary commercial value. If the State chooses to impose statutory control in respect of terms and conditions of tenancies in properties and such control is statutorily enforced, then during the subsistence of such control, such properties would necessarily have value which is controlled. The State cannot then turn around and say th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier one, we would prefer to make a reference to the earlier decision only. The assessee in this case owned a share in some immovable properties. The properties were fully developed and tenanted and the tenancies were regulated by the Rent Control Act. The Valuation Officer determined the value of the properties by adopting the "rent capitalisation method" and added certain amounts to it on account of the reversionary value of the land. The Tribunal held that the reversionary value of land should not be included While computing the value based on the "rent capitalisation method". It was held that the valuation of assets had to be made in each case with due regard to the conditions of the time and factors which affected transactions between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pradesh High Court has held that the development potentialities of the building could not be ignored in determining its market value. This judgment cannot be an authority to support the contention advanced on behalf of the Revenue that the reversionary value of the land ought to be included in computing its value for purposes of wealth-tax. Unlike the case before us, in this case, the property was being developed into a multi-storeyed building. There was no question of its being in existence and occupied by tenants ; nor was there any question of applicability of rent control legislation. The court did not consider the effect of such factors. The facts in this Case were totally different and it does not serve as any guide for the problem in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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