Wealth-tax exemption for office premises used commercially was upheld where the binding circular expanded the exemption scope.

Exemption under section 5(1)(iv) of the Wealth-tax Act was stated to extend to office premises used for commercial purposes, where the CBDT circular clarified that such property remained within the exemption. The commentary notes that the circular was binding on departmental authorities and that the Wealth-tax Officer had overlooked it. On that basis, the value of the office premises was to be excluded from the wealth computation, and the Revenue's challenge was unsuccessful.

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Issues: Whether exemption under section 5(1)(iv) of the Wealth-tax Act was available in respect of office premises used for commercial purposes, and whether the departmental authorities were bound by the CBDT circular clarifying the scope of the exemption.

Analysis: The assessee claimed exemption for office premises in Dalamal Chambers under section 5(1)(iv). The appellate authority relied on CBDT Circular No. 317/23/73-WT dated 24 July 1973, which clarified that the exemption was available even where the house was used for commercial purposes. The Tribunal noted that the circular was binding on the departmental authorities and that the WTO had overlooked it.

Conclusion: The exemption was available to the assessee for the office premises, and the appellate authority's direction to exclude its value from the wealth computation was ; the Revenue's challenge failed.

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