Ownership in wealth tax depends on possession and allotment, so exemption may apply even without a conveyance deed.

A flat allotted under an agreement, with full payment, possession and user, was treated as belonging to the assessee for wealth-tax purposes even though no formal conveyance deed had been executed. The decisive test was ownership for inclusion in net wealth: where the assessee had been put in full possession by the promoter and could not be evicted, the property was regarded as the assessee's asset. On that basis, exemption under section 5(1)(iv) of the Wealth-tax Act, 1957, was available and could not be denied.

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Issues: Whether a flat allotted under an agreement, against payment and with full possession and user, could be treated as belonging to the assessee for the purposes of wealth-tax, and whether exemption under section 5(1)(iv) of the Wealth-tax Act, 1957, was admissible.

Analysis: The assessee had paid the full consideration and obtained possession of the flat, though no formal conveyance deed had been executed. A property can be included in the net wealth only if it belongs to the assessee. Where the assessee has been allotted the flat by the promoter, enjoys full possession and user, and cannot be evicted by the promoter, the asset is to be regarded as belonging to the assessee for wealth-tax purposes. On that footing, the exemption under section 5(1)(iv) cannot be denied.

Conclusion: The flat belonged to the assessee for wealth-tax purposes, and the assessee was entitled to exemption under section 5(1)(iv) of the Wealth-tax Act, 1957.

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