TaxTMI 
TaxTMI 
1991 (5) TMI 2
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....stimated by the Appellate Assistant Commissioner ?" Shortly stated, the facts are that the assessee filed before the Wealth-tax Officer two valuation reports in respect of the plot of land being 37F, Paikpara Road, Calcutta. The first report dated November 30, 1972, estimated the then market value of the plot at Rs. 77,000. The second report dated July 8, 1977, showed the value at Rs. 11,650, the decline being attributed to the depressing effect of the passage of the Urban Land (Ceiling and Regulation) Act, 1976. The Wealth-tax Officer did not accept the contention of the assessee as regards the valuation of the land on the ground that the value of Rs. 77,000 in 1972 could not go down to Rs. 11,500 after five years. He also observed that....
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....77,000 only. The assessee got relief of Rs. 1,11,600. The Department appealed to the Tribunal and contended that the Appellate Assistant Commissioner erred in his decision. The assessee was not represented before the Tribunal at the time of hearing of the appeal. The Tribunal considered the issue raised in the appeal and held as below: "We find that the valuation adopted by the Wealth-tax Officer is based on actual enquiry made by him through his inspector. The average rate of sale of land in the adjoining area has not been controverted. The assessee merely insisted that his valuation report should be accepted. In our opinion, the value at which plots of land in the adjoining area were actually sold is a better index for determining t....
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....nder the Act. The Tribunal could not have given any discount of Rs. 1,000 per kottah from the value determined by the Wealth-tax Officer. There is no basis at all for arriving at such a valuation. He has, however, fairly submitted that since the assessee did not challenge the determination made by the Appellate Assistant Commissioner at Rs. 77,000, he cannot ask for reduction of the valuation below Rs. 77,000. The contention of the Revenue before us is that the valuation was adopted on the basis of the comparable sale instances of adjoining lands and because it is vacant land within the meaning of the Urban Land Ceiling Act which did not vest at the material time, the Tribunal was justified in giving certain reduction in the valuation. ....
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.... the vacant land in excess, if exempted, could be used for certain specific purposes. In our view, such vacant land in excess, although may be sold in the open market, cannot be transferred by way of mortgage, lease or otherwise in view of the provisions contained in section 5 of the Land Ceiling Act. Any transfer made in contravention of the provisions of sub-section (3) of section 5 of the Land Ceiling Act shall be deemed to be null and void. In such a case, therefore, there may not be any willing purchaser for such vacant land. In our view, therefore, when land cannot be sold in the open market, the question of valuation on the hypothetical basis as to what price it would have fetched had it been sold in the open market could not aris....
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....cer, but accepted by the appellate authority and the Tribunal. The Madras High Court also observed that, normally, the market value of land is the value which the land, if sold in the open market by a willing seller, might be expected to realise, such market value being generally ascertained on a consideration of the prices obtained by sale of adjacent lands with similar advantages. If there are no sales of comparable lands, the value must be found in other ways. One method is to take the annual income which the owner may expect to obtain from the land and capitalise it by the number of years' purchase and the capitalised value is taken as the market value which a willing seller may reasonably expect to obtain from a willing buyer. If this ....