Industrial land exclusion under wealth-tax upheld where valuation date facts showed active industrial use and existing constructions.

Property used for a long period as an industrial unit, with substantial existing constructions, industrial activity, and refusal of construction approval, was held not to be urban land chargeable to wealth-tax under section 2(ea) of the Wealth-tax Act. The asset's factual character on the valuation date was decisive, and it could not be treated as taxable urban land merely because of surrounding development or a possible future use mentioned in the lease deed. The appellate authority treated the land as industrial land and applied the relevant exclusion and exemption position, resulting in deletion of the wealth-tax addition. The departmental appeals therefore failed.

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Issues: Whether the property in question was an asset chargeable to wealth-tax as urban land under section 2(ea) of the Wealth-tax Act, 1957, or was excluded because it was an industrial/commercial establishment and therefore not taxable in the assessee's hands.

Analysis: The land had been used as an industrial unit for a long period, and the record showed substantial existing constructions, industrial activity, and refusal of construction approval by the competent authority. The factual character of the asset as on the valuation date was decisive, and it could not be treated as urban land merely because of surrounding developments or a possible future use mentioned in the lease deed. The appellate authority also held that the property was to be valued as industrial land and that the exclusion provisions and the exemption claims supported deletion of the addition.

Conclusion: The property was not taxable as urban land under section 2(ea) and the addition to net wealth was rightly deleted; the departmental appeals failed.

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