Ceiling-restricted land valuation must reflect statutory compensation, not unrestricted market value, for wealth-tax purposes.

Vacant land held in excess of the ceiling limit under the Urban Land (Ceiling & Regulation) Act, 1976 must be valued for wealth-tax purposes by reference to the compensation payable under that statute, because the statutory restrictions and prohibitions depress its realizable value and cannot be ignored. The Tribunal followed binding High Court authority on valuation of ceiling-restricted land and distinguished contrary authority that arose under a different statute and factual setting. On that basis, the excess land was not to be valued on an unrestricted market-value basis.

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Issues: Whether surplus land held in excess of the ceiling limit under the Urban Land (Ceiling & Regulation) Act, 1976 was required to be valued for wealth-tax purposes on the basis of the compensation receivable under that Act, rather than on an unrestricted market-value basis.

Analysis: The restrictions and prohibitions imposed by the ceiling law could not be ignored while valuing the excess vacant land. Where the land is subject to statutory ceiling restrictions, its value stands depressed and the proper basis of valuation is the compensation payable under the ceiling legislation. The Tribunal followed the direct High Court authority holding that vacant land in excess of the ceiling limit must be valued after taking note of such restrictions. The contrary authority relied on for the Revenue was distinguished as arising under a different statute and from a different factual and legal setting, and the Tribunal also noted that an earlier contrary Tribunal view was rendered without the benefit of the later binding High Court decision.

Conclusion: The surplus land was to be valued at the compensation rate receivable under the Urban Land (Ceiling & Regulation) Act, 1976, and the assessee succeeded on this issue.

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