Court directs reevaluation of assessment orders, upholds petitioner's challenge on property exemption. Proof of 'gift' needed.

The Court set aside the assessment orders for the years 1998-1999 and 1999-2000, directing a reevaluation within three months. The petitioner's challenge against the denial of exemption for a property in Kodaikanal gifted by her husband was upheld. The Court emphasized the need for proof of the nature of conveyance as a 'Gift' under Section 4 (1) (a) (i) before granting exemption, allowing the petitioner the opportunity to establish the gift by her husband.

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Issues:
Challenge against assessment orders under Wealth Tax Act regarding property gifted by husband. Examination of exemption claim under Section 51 (vi) and Section 4 (1) (a) (i) for assessment years 1997-1998, 1998-1999, and 1999-2000. Dispute over nature of conveyance as 'Gift' and validity of exemption claim.

Analysis:
The petitioner contested Ext.P7 order by the second respondent, which denied the challenge against assessment orders related to a property in Kodaikanal gifted by the petitioner's husband. The petitioner initially received assessment orders for 1997-1998, 1998-1999, and 1999-2000, without claiming exemption. Subsequently, the husband gifted a building in Kodaikanal to the petitioner, who then sought exemption under Section 51 (vi). The assessing authority valued the property higher than declared, but granted the exemption. The petitioner later filed revision petitions seeking exemption for the Kodaikanal property. The second respondent allowed exemption for the Madras property but declined interference for 1998-1999 and 1999-2000, prompting the present challenge.

The petitioner argued that as per Section 4 (1) (a) (i), the Kodaikanal property should only be assessed under the husband's name due to it being a 'Gift' without "adequate consideration." The respondents contended that the petitioner failed to prove the nature of conveyance as a Gift, emphasizing the need for proof to claim exemption under Section 4 (1) (a) (i). The respondents highlighted the necessity of proving the Gift to avail the exclusion from wealth assessment for the relevant years.

The Court found that while the second respondent accepted the petitioner's request to exempt the Madras property instead of the Kodaikanal property, doubts remained regarding the nature of the conveyance as a Gift. The Court directed the second respondent to reevaluate the matter, allowing the petitioner to prove the Gift by her husband. The Court emphasized the need for the respondents to verify the validity of the Gift before extending the exemption under Section 4 (1) (a) (i) of the Act. The impugned order was set aside for the assessment years 1998-1999 and 1999-2000, with directions for a reexamination within three months from the judgment's receipt. The Original Petition was disposed of accordingly.

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