TaxTMI 
TaxTMI 
1985 (11) TMI 87
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....Rs. 46,050 as assessable to wealth-tax as under : "Immovable Properties : Building leased out to Perinthalmanna Rice & Oil Mills, Rs. Perinthalmanna 40,....
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....p; 46,050.00" ------------------------- In the assessment made on 20-12-1979, the WTO accepted the assessee's claim and taxed the immovable property of Rs. 46,050. As the WTO noticed that t....
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....ld that the WTO's action in seeking recourse to the provisions of section 35 was justified. He also upheld the action of the WTO in denying exemption under section 5(1)(xxxi) to the assessee. Aggrieved by the order of the AAC the assessee preferred the present appeal. 4. At the time of hearing, the assessee's counsel urged that the WTO was not justified in resorting to section 35 as there was no mistake apparent from the record. He further pointed out that wealth-tax is levied under the power derived under entry 86 of the Union List of the Constitution of India and that the entry authorised tax on capital value of the assets of individuals and companies and as per section 5(1)(xxxi) the exemption is with reference to the value of the ass....
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....s High Court in the case of CWT v. P. T.N. Shenbagamoorthy [1983] 144 ITR 724 wherein it was held that the assessee, who owned the salt pans but who had leased out the same to a third party, could not be held to be actually engaged in the manufacture of salt and, consequently, could not get exemption under section 5(1)(xxxi). He further submitted that in view of the above arguments advanced the decision of the Madras High Court need not be followed. 5. The departmental representative submitted that the WTO was justified in invoking section 35 as the assessee claimed exemption under section 5(1)(xxxii) and the WTO granted the exemption under section 5(1)(xxxii). Section 5(1)(xxxii) comes into play only when the assets forming part of an i....
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....lands and buildings. It is a tax on the capital value of the assets of individuals and companies on the valuation date. The wealth-tax is not imposed on the components of the assets of the assessee; it is imposed on the total assets which the assessee owns,..." Section 2(m) of the Act defines net wealth as the amount by which the aggregate value of all the assets belonging to the assessee in excess of the aggregate value of debts owed by the assessee. Thus, it is clear that wealth-tax is levied on the total assets owned by the assessee and that ownership of the assets is the criterion for the levy or exemption as the case may be. The heading of section 5(1) refers to 'Exemptions in respect of certain assets'. Section 5(1) says that wealt....