TaxTMI 
TaxTMI 
1976 (3) TMI 71
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.... of the said two assets had been claimed under cl. (viii) of s. 5(1) of the Act on the plea that the said cars were articles intended for the personal or household use" of Shri Nirbhai Singh. The Tax Officer allowed exemption in respect of the car, the value of which was Rs. 20,000 but disallowed exemption in respect of the second, car impliedly on the ground that exemption could be claimed only in respect of one car. The said finding of the Tax Officer on appeal was confirmed by the Appellate CIT. It is important to note that neither of the said authorities gave any finding that the car in respect of which exemption was not allowed "was not an article intended for the personal or household use of the assessee. Both the said authorities proceeded on the footing that it was only one car that could be entitled to exemption. The assessee has argued that there is no such limitation as to the number of articles "intended for the personal or house-hold use of the assessee" in respect of which exemption can be claimed under s. 5(i)(viii). Nor is there any limit on the total value of such articles upto which exemption under s. 5(i)(viii) can be claimed so far as the text of the said sectio....
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....d on a valuer's report dt. 30th Sept., 1968. According to the said report, the value of the Moti Theatre was Rs. 2,40,000 and of the Roxy building Rs. 80,000 8. In the instant case, the Tax Officer enhanced the value of both the said buildings. The value of Moti Theatre was enhanced from Rs. 2,40,000 to Rs. 4,38,620. The reason for enhancement was given by the Tax Officer to be the increase in the lease amount in respect of the said building from Rs. 24,000 to Rs. 30,000 per annum. The net annual value on the basis of the said increased rate of rent was worked out by applying a multiple of 20 after deducting outgoings to the tune of Rs. 8,069 by way of property tax and house tax. The net annual value so arrived at was Rs. 21,931. The Tax Officer also mentioned that as the said enhanced valuation had been accepted by Shri Bhagwan Das, another partner in the firm Moti Theatre to the extent of 5 annas share in the firm's profit, the said assessee also should be. Similarly, in respect of the Roxy building, the value was enhanced from Rs. 80,000 to Rs. 1,60,000. This enhancement was stated to be made on the basis of income-tax record of the firm Roxy Theatre. 9. On appeal, the App....
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....is section) under this Act, the WTO may refer the valuation of any asset to a Valuation Officer :— (a) in a case where the value of the asset as returned is in accordance with the estimate made by a registered Valuer, if the WTO is of opinion that the value so returned is less than its fair market value. (b) in any other case, if the WTO is of opinion :— (i) that the fair market value of the asset exceeds the value of the asset as returned by more than such percentage of amount as may be prescribed in this behalf; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do." Rule 5B, WT Rules is also relevant. It reads :— "5B. The percentage of the value of the asset as returned and the amount referred to in sub-cl.(i) of cl. (b) of sub-s.(i) of s. 16A shall, respectively, be 33-1/2 percent and Rs. 50,000." 12. It is agreed that the power of the WTO as available under s. 7(1), WT Act, in the matter of estimating the value of any assets, after 1st Jan., 1973, i.e., the date from which s. 16A was enacted, stands ourtailed by s. 16A and that, therefore, the enhancement in question could not be sustained. T....
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....Officer the enhancement is to be struck down straight away and only the returned value is to be accepted as correct. The only consequence of WTO's failure to refer the valuation to the Valuation Officer would be that the enhancement cannot be sustained beyond the prescribed limit. We hold accordingly. 17. Lastly it was argued by the assessee that the enhancement in the present case has been made in respect of Moti Theatre building on the plea that the annual lease rent stood raised to Rs. 30,000 on 31st march, 1969 from Rs. 24,000 as on 31st March, 1968 and that instead of taking one particular year's gross rent into consideration, the Department should have taken into consideration the prevailing rent, which is capable of being maintained. In this connection, the following portion at page 40 of the 1970 edition of the Park's "Principles and Practice of Valuation" has been relied upon :— "For the purpose of valuation gross rent must be the fair rents, because, it is on the basis of fair rents that market value is estimated and fair rent may be defined as the prevailing rent, which is capable of being maintained not for one or two years but at a particular date and sometime ....