TaxTMI 
TaxTMI 
2015 (2) TMI 172
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.... "asset" within the meaning of section 2(ea) of the W.T. Act, 1957." 3. The short facts of the case are that the assessee company has planned to set up a state of the art international education institution with world class affiliation and purchased a plot of land called "CONO" situated at Siridao- Palem, Tiswadi Taluk on 08.03.2004. The assessee has converted this land into stock in trade during the financial year ending 31.03.2006. However, as on 31.03.2005 the assessee was in possession of this vacant urban land, which is within 8 kms from the limits from the municipal limits of Panaji. The said asset is an "asset" within the meaning of section 2(e)(a) of the Wealth Tax Act. Therefore, considering the costs of land the Assessing Officer has computed the net Wealth Tax and he has estimated the Market Value at 40,00,00,000/- and taxable wealth was assessed. 4. The matter carried to CIT(A) and CIT(A) has deleted the Wealth Tax by observing as under: "7. I have gone through the assessment order and arguments of the learned counsel of the appellant. There is no difference of opinion as far as facts of this case is concerned between the A.O. and the appellant. The facts, as n....
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....f the facts of this case, in my opinion, the land is not liable for wealth tax and the A.O. is directed to delete the addition made. This Ground of appeal of appellant is accordingly allowed. 10. In view of the decision arrived at by the undersigned, other Grounds of appeal become Infructuous and therefore the same are not being adjudicated upon." 5. The Department is in appeal against the said order. The assessee has filed Cross Objection and Additional Cross Objection which read as under: Grounds in cross objection: a) In para 3.7 of the Assessment Order the AO has erred in valuing the land on his own at Rs. 40 Crores without referring the same to the Departmental Valuation Officer for determining its market value as per Schedule III Part H referred by Sec 7 of the Wealth Tax Act. The AO has erred in not giving an opportunity of being heard to the assessee and valuing the land at much higher amount than the amount as per valuation report obtained by the Company from a registered valuer. b) The AO has not given deduction of the unsecured loans of Rs. 5.33 crs taken for the purpose of buying the land. The same loans are reflected in the Audited Balance Sheet as at 31....
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....sider that question in order to correctly assess the tax liability of an assessee. The reframed question, therefore, is answered in the affirmative, i.e., the Tribunal has jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on the tax liability of the assessee. We remand the proceedings to the Tribunal for consideration of the new grounds raised by the assessee on the merits. Therefore, we permit to raise the additional ground." We respectfully following the decision of Hon'ble Supreme Court, we permit the raise the additional ground. 8. The learned AR has filed the written submission before us. In the written submission the assessee has submitted as per the section-3 of Wealth Tax Act, the net wealth of a person is chargeable in wealth tax. Section-2 (m) defines "Net Wealth" as per amount by which the aggregate value of assets, belonging to an assessee, is in excess of all the debts owned by the assessee. Section 2 (ea) of the Wealth Tax 1957 categorises the assets into 6 clauses. Sub-section (v) of section 2 (ea) considered the urban land as an assets. Explanation-1 (B) of Section 2 (ea) considers u....
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....e it is not chargeable to wealth tax. 9. Learned DR submitted that property situated within 8 kms from the local limits of such municipalities, therefore, this evidence will not be helpful to the assessee. 10. We have heard the rival contention of both the parties. Looking to the facts and circumstances of the case, we find that Section 2(ea) of the Wealth Tax Act categorised the urban land as under: "i) any area which is comprised within the Jurisdiction of a municipality (Whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the valuation date and ii) Land situated within 8 kms from the local limits of such municipalities or cantonment as the Central Government may specify." In the instant case the valuation date is 31st March, 2005 and the last census preceding this date 2001, Further land containing Survey No. 15,16,17,18,20,21 and 22 is situated in village Panchayat Siridaon, Goa, Goa. The population of the....
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....idao-Palem. Tiswadi-Goa. Therefore, as per the above documentary evidence the land at Survey No.15,16,17,18,20, 21 and 22 is located within jurisdiction of village Panchayat Siridao Goa is not urban land as per definition contained in explanation 1(b)(i) of Section 2(ea). The next question comes regarding the measurement of distance from one point to another. In the following cases it has been held that distance has to be measured by the road and the distance cannot be the aerial distance. CIT vs. Santinder Pal Singh 188 Taxman 54 (Punj & Har.) Laukik Developers vs. Dy. CIT 105 ITD 657 (Mumbai) Shri Prakash Laxminarayan Vs. ACIT, Cir-5(Nagpur) ITO vs. Ashok Shukla, decided in ITA No. 207/Indore/2012 We find that the agricultural land has been defined in Section 2(14) (b) of which read as under: "[(iii) agricultural land in India, not being land situate- (a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population4 of not less than ten thousand [according t....
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....h road rather than by straight line on horizontal plane. If principle of measurement of distance is considered straight line distance on horizontal plane or as per crow's flight then it would have no relationship with the statutory requirement of keeping in view the extent of urbanization. Such a course would be illusory. It is in pursuance of the aforesaid provision that Notification No.9447, dated 6-1-1994 has been issued by the Central Government. In respect of the State of Punjab, at item No. 18, the Sub-Division, Khanna has been listed at serial No. 19. It has, inter alia, been specified that area up to 2 kms. from the municipal limits in all directions has to be regarded other than agricultural land. Once the statutory guidance of taking into account the extent and scope of urbanization of the area has to be reckoned while issuing any such notification then it would be incongruous to the argument of the Revenue that the distance of land should be measured by the method of straight line on horizontal plane or as per crow's flight because any measurement by crow's flight is bound to ignore the urbanization which has taken place. Moreover, the judgment of the Mumbai ....