TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Tribunal rules lands as agricultural, dismisses Revenue's appeal. Assessees' cross objections unnecessary.</h1> <h3>The Assistant Commissioner of Wealth Tax, Central Circle 1 (2), Bangalore Versus Shri M.R. Jayaram, Shri M.R. Janakiram And Shri M.R. Seetharam</h3> The Assistant Commissioner of Wealth Tax, Central Circle 1 (2), Bangalore Versus Shri M.R. Jayaram, Shri M.R. Janakiram And Shri M.R. Seetharam - TMI Issues Involved:1. Validity of wealth tax liability on urban lands.2. Validity of reopening assessments under Section 17 of the Wealth-tax Act, 1957.3. Measurement of distance for determining urban land.4. Classification of land as agricultural or non-agricultural.Detailed Analysis:1. Wealth Tax Liability on Urban Lands:The primary issue was whether the lands owned by the assessees, situated at Akkelenahalli-Mallenahalli village, fall under the definition of 'urban land' as per Explanation 1(b) to Section 2(ea) of the Wealth-tax Act, 1957, thus making them liable for wealth tax. The Assessing Officer (AO) concluded that the lands were within 8 KMs from BBMP limits and under the jurisdiction of BIAPPA, which he considered akin to a Municipality. Consequently, the AO included the value of these lands in the net wealth of the assessees.2. Reopening of Assessments:The assessees challenged the validity of the reopening of assessments under Section 17 of the Wealth-tax Act. They argued that the lands did not qualify as 'urban land' and thus were not liable for wealth tax. The Commissioner of Income-tax (Appeals) [CIT(A)] allowed the appeals of the assessees, following the decision of the ITAT in the assessees' own cases for the earlier assessment year 2005-06.3. Measurement of Distance:The Revenue contended that the distance of 8 KMs from BBMP limits should be measured aerially (as the crow flies) rather than by road. They cited the substituted provisions of Section 2(14)(iii)(b) of the Income-tax Act, 1961, effective from 01/04/2014, as clarificatory and applicable retrospectively. However, the Tribunal held that these provisions are prospective and applicable only from assessment year 2014-15 onwards. The Tribunal emphasized that the law applicable for the assessment years in question (2007-08 and 2009-10) should be considered, and the distance should be measured by road.4. Classification of Land:The Tribunal also addressed whether the conversion of the lands from agricultural to non-agricultural purposes affected their classification. The Tribunal noted that despite the conversion, the lands continued to be used for agricultural purposes until the date of sale. Therefore, the lands should be treated as agricultural lands, not urban lands or capital assets.Conclusion:The Tribunal dismissed the Revenue's appeals, holding that the lands in question are agricultural lands and not liable to wealth tax. The Tribunal also dismissed the cross objections of the assessees challenging the reopening of assessments as academic and infructuous, as the main issue was decided in their favor. The Tribunal's decision was based on the precedent set by the co-ordinate bench in the assessees' own cases for the earlier assessment year and the case of Shri M.R. Seetharam.
TaxTMI 