1993 (1) TMI 51

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....not be taken into account ? " The reference arises in regard to wealth-tax assessments in relation to three brothers who own undivided 1/3rd share in certain common assets. The assets include a building in property No. 250-B, Lake Town, within the limits of the Calcutta Corporation. The assessee valued it at Rs. 1,79,224 as suggested by an approved valuer. This valuation was made by the multiplier method on the basis of the contract rent. The Wealth-tax Officer referred the matter to the Departmental Valuation Officer who fixed the value at Rs. 5,05,838 by adding the value of the "reversionary right of the landlord" to the value arrived at on the basis of the rent. The Wealth-tax Officer accepted the same and passed the assessment order ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ng in the market. Therefore, valuation is based on the price paid within reasonable time in bona fide transactions of purchase of comparable land in the vicinity or on a number of years' purchase of actually or immediately prospective profits of the land acquired or on the opinion of experts. These methods do not preclude the court from taking any other special circumstances into consideration, the requirement being always to arrive as near as possible at an estimate of the market value. In arriving at a reasonably correct market value, it may be necessary to take even two or all of those methods into account inasmuch as the exact valuation is not always possible. See Special Land Acquisition Officer v. T. Adinarayan Setty, AIR 1959 SC 429,....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Acquisition Act, 1894, can also be adopted for a similar purpose under the Wealth-tax Act, 1957. In the case of tenanted building property, certain additional considerations have to be borne in mind. In areas governed by the Rent Act or the Rent Control Act, it may not be possible for the landlord to enhance the rent or evict the tenant ; even otherwise, the process of enhancement of rent or fixation of standard or fair rent, or eviction may be beset with unreasonable delay, expense and other complications. In such cases the appropriate method of valuation is to capitalize the annual rent by certain number of years' purchase. See CWT v. V. C. Ramachandran [1966] 60 ITR 103 (Mys), Corporation of Calcutta v. Padma Debi, AIR 1962 SC 151, CE....