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Issues: Whether, for exemption under section 5(1)(iii) of the Wealth-tax Act, 1957, only the building or portion of the building actually in the occupation of a Ruler and declared as the official residence is excluded from net wealth, or whether the entire building remains exempt even if substantial parts are let out.
Analysis: The exemption provision was construed by its plain language, giving effect to every word used, especially the expression "in the occupation of a Ruler". In a taxing statute, the subject can claim exemption only when the case falls strictly within the provision. Reading the clause to exempt the whole building merely because part of it is occupied would make the words "in the occupation" redundant and would amount to impermissible addition to the text.
Conclusion: The exemption is limited to the building or portion actually in the occupation of the Ruler and declared as official residence; the let-out portions are includible in net wealth. The answer is in favour of the Revenue.
Final Conclusion: The appeal failed because the claimed exemption could not extend beyond the part of the property satisfying the statutory requirement of occupation by the Ruler.
Ratio Decidendi: In construing a taxing exemption, effect must be given to every word of the provision, and only the part of the building actually in the occupation of the Ruler and declared as official residence is exempt from wealth-tax.
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