1990 (3) TMI 150 - AT - Wealth-tax

Tribunal includes 'jeeps' as 'motor cars' under Finance Act, 1983 for wealth tax.

Deputy Commissioner Of Wealth-Tax. Versus Industrial Oxygen Company (Private) Limited.

The Tribunal interpreted the expression 'motor cars' in the Finance Act, 1983 to include 'jeeps,' ruling that jeeps fall within the definition of motor ... Net Wealth Issues:Interpretation of the expression 'motor cars' in sub-section (3) of section 40 of the Finance Act, 1983 to determine if it includes 'jeeps.'Analysis:The judgment pertains to four appeals by the department regarding the assessment years 1984-85 to 1987-88 for the assessee Industrial Oxygen Co. (P.) Ltd. The key issue revolves around whether 'jeeps' owned by the assessee-company fall within the ambit of the expression 'motor cars' in clause (vii) of sub-section (3) of the Finance Act, 1983. The controversy arises as the inclusion of jeeps in the definition of motor cars impacts the net wealth subject to wealth tax under the Act.The Tribunal considered the interpretation of the expression 'motor cars' in a similar context in a previous case involving Kirloskar Consultants Ltd. The Tribunal in that case held that 'jeeps' were not included in the expression 'motor cars' based on the intention behind the provisions and the purpose of avoiding lavish expenditure on certain vehicles. However, the Tribunal clarified that this interpretation was specific to the provision in question and not a blanket interpretation for all provisions.To resolve the issue at hand, the Tribunal delved into the definitions of 'motor,' 'car,' and 'motor car' from standard dictionaries and legal statutes. It noted that a jeep, used as a passenger car, falls within the definition of a motor car under the Motor Vehicle Act and general understanding. Additionally, the Income-tax Act allows depreciation for jeeps under the category of 'motor cars,' further supporting the inclusion of jeeps in the definition.The Tribunal also cited a decision by the Kerala High Court, which held that the expression 'motor car' includes jeeps based on common parlance and dictionary meanings. The High Court's interpretation aligned with the definition of 'motor car' under the Motor Vehicle Act.Ultimately, the Tribunal concluded that the expression 'motor cars' in the Finance Act, 1983 should be interpreted broadly to encompass all motor vehicles used for carrying passengers, including jeeps. As a result, the Tribunal upheld the inclusion of the value of jeeps in the net wealth of the assessee-company for wealth tax assessment, overturning the decision of the Commissioner of Wealth Tax (Appeals).In light of the comprehensive analysis and legal interpretations provided, the Tribunal allowed the department's appeals, setting aside the order of the Commissioner of Wealth Tax (Appeals) and restoring the order of the Wealth Tax Officer.