Restricted industrial land excluded from urban land classification under wealth tax, and DVO-based valuation addition not sustained.

Land allotted for industrial use with binding restrictions on open space and limited construction was held not to fall within the taxable definition of "urban land" under the Wealth Tax Act to the extent construction was not lawfully permissible, and the portion occupied by approved factory structures was also excluded under clause (b) of the Explanation to section 2(ea). The addition based on the DVO's higher valuation was not sustained because the property had been consistently treated on the same basis and there was no material change in facts warranting a different view. The relief granted by the first appellate authority was upheld.

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Issues: Whether the sanad land, subject to restrictions on use and construction, fell within the definition of "urban land" and was therefore includible in net wealth under the Wealth Tax Act, and whether the valuation adopted by the Assessing Officer on the basis of the DVO could be sustained.

Analysis: The land was allotted for industrial use with binding conditions that a major portion remain open to the sky and only a limited portion be used for construction with approval of the competent authority. On these facts, the land on which construction was not permissible under the governing land-revenue regime, and the portion already occupied by approved factory structures, attracted the exclusion in clause (b) of the explanation to section 2(ea). The reasoning was reinforced by the consistent earlier treatment of the same property and the settled principle that, absent a material change in facts, a different view should not be taken merely because the DVO adopted a higher valuation.

Conclusion: The land was outside the taxable definition of urban land to the extent held excluded by law, and the addition based on the DVO valuation was not sustainable. The relief granted by the first appellate authority was upheld.

Ratio Decidendi: Land that, by reason of the governing legal restrictions, cannot have construction lawfully made upon it, or is occupied by approved construction, falls within the exclusion from "urban land" under section 2(ea) and is not chargeable to wealth tax on that basis.

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