TaxTMI 
TaxTMI 
2016 (7) TMI 464
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....overnment rates published in the Ready Reckoner by Government of Maharashtra. He further noted that the assessee has claimed deduction u/s.2(m) of the Act on the ground that these assets are mortgaged properties. During the course of assessment proceedings the AO noted that the claim of debts owed to the extent of Rs. 2,05,92,303/- as claimed in the submission u/s.2(m) of the Wealth Tax Act is not tenable since the debts are not owned by the assessee directly. The assets are provided only as security for the loans of the company. According to the AO when the company B.C. Biyani Projects Ltd. defaults, then the mortgaged assets of the assessee come under the purview of debts owed and even then the company B.C. Biyani Projects Pvt. Ltd. has to make good to the assessee the liability to the extent of assets of the assessee utilized by the bank for recovery in company case. Therefore, according to the AO, there are no debts of the assessee at the first instance and in case the mortgage charge is considered for recovery by bank, then also the assessee has to be reimbursed from defaulter. Hence, there is no prima-facie claim admissible u/s.2(m) of the Wealth Tax Act as debts owned. 4.....
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....e prescribed by Govt. Sub Registrar office for stamp duty purpose. The appellant had shown value of the assets in W.T return as per the value prescribed by Sub Registrars office for stamp duty purpose, whereas the A.O. had assessed the value of the assets as per valuation made my banks valuer for loan purpose. Therefore the appellant has valued the assets and shown the same in wealth tax returns on reasonable basis, i.e. value of the assets as determined by Government Authorities against value of the assets for loan purpose as determined by Bank's valuer. Therefore though the addition is justified, the issue is debatable and two views are possible. Therefore penalty for concealment of wealth u/s.18(1)(c) is not livable. Further the appellant has clearly mentioned in the returns of wealth that the assets have been valued at the rates prescribed by Sub Registrar's office for stamp duty purpose. Therefore the appellant has disclosed all the particulars of wealth and has not concealed anything from the department. It is also settled law that addition to value of assets on the basis of valuer's report which is merely an estimate, does not attract penalty u/s.18(1)(c) o....
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....the Department. Further, addition to value of assets on the basis of valuer's report is merely an estimate and does not attract penalty u/s.18(1)(c) of the I.T Act. He accordingly submitted that the order of the CWT(A) be upheld and the grounds raised by the revenue be dismissed. 12. We have considered the rival arguments made by both the sides, perused the orders of the AO and CWT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions relied on by both the sides. We find the AO in the instant case has levied penalty on account of 3 additions/disallowance. So far as penalty levied on account of disallowance of Wealth Tax liability as deduction from the net wealth is concerned, the CWT(A) has already confirmed the penalty on this account and the assessee is not in appeal before us. Therefore, we are not concerned with this. 13. So far as levy of penalty on account of denial of deduction u/s.2(m) of the Act on account of mortgaged assets are concerned, we find the Tribunal in WTA Nos. 27 to 31/PN/2014 and batch of other appeals order dated 31-07-2014 for A.Y. 2005-06 to 2009-10 has already deleted such addition/disallowance on the g....
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....e to the grounds taken in appeal." 17. After hearing both the sides, we find the grounds raised by the Revenue in the above appeal are identical to the grounds raised in WTA No.06/PN/2016. We have already decided the issue and the appeal filed by the Revenue has been dismissed. Following the same reasoning, the appeal filed by the Revenue is dismissed. WTA No. 08/PN/2016 (A.Y. 2007-08) : 18. Grounds raised by the Revenue are as under : "1. On the facts and in the circumstances of the case, the CWT(A) erred in reducing the penalty from Rs. 4,97,721/- to Rs. 3,478/- levied u/s.18(1)(c) of the Wealth Tax Act, 1957 by the A.O. 2. On the facts and in the circumstances of the case, the CWT(A) ought to have confirmed the penalty levied on the issues, i.e. under valuation of property, that has been confirmed by the Hon'ble ITAT. 3. The appellant craves leave to add, alter, modify, delete amend any of the grounds with prior permission of the Hon'ble Pr. CWT, as per the circumstances of the case. 4. The appellant prays to file any of the additional evidence with prior permission of the Hon'ble Pr. CWT, appropriate to the grounds taken in appeal." ....