COMMISSIONER OF WEALTH TAX VS JAIDEV INDER SINGH

1992 P T D 1472

[Punjab and Haryana High Court (India)]

[195 I T R 367]

Before S.S. Sodhi and K.P. Bhandari, JJ

COMMISSIONER OF WEALTH TAX

Versus

JAIDEV INDER SINGH

Wealth Tax References Nos.25 to 28 of 1981, decided 17th July, 1991.

Wealth tax---

---- Additional Wealth Tax---Exemption---"Business Premises" meaning of-- Agricultural operations carried on in urban land---Constitute business premises---Entitled to exemption.

Where agricultural operations are carried on urban land, the land will fall within the definition of the expression "business premises" as provided in rule 1(i), Paragraph B, Part I, of the Schedule to the Indian Wealth tax Act, 1957, and would thus be entitled to exemption from the charge of additional wealth-tax on the urban assets, under Paragraph A(2) of the Schedule.

CWT v. Hari Singh (1980) 123.ITR 558 (P & H); CWT v. Devinder Kaur (Sint.) (1984) 146 ITR 234 (P & H) and CWT v. Sara Varghese (Mrs.) (1988) 170 ITR 436 (Ker) fol.

A.K. Mittal for the Commissioner.

None appeared for the Assessee.

JUDGMENT

S.S. SODHI, J.--The matter here relates to exemption from additional wealth-tax for the assessment years 1970-71 to 1973-74. The controversy being whether urban land where agricultural operations are carried on, falls within the definition of "business premises" in terms of rule 1(i), Paragraph B, Part 1, of the Schedule to the Wealth-tax Act, 1957, and is thus entiled to exemption from additional wealth-tax payable on urban assets?

The assessee owns 439 Kanals and 2 Marlas of land in Amritsar, which he claims to cultivate himself. It is in this context that we have been called upon to decide the question posed, namely:

"Whether the Appellate Tribunal is right in law in holding that the assessee's agriciotural lands were covered by the expression `business premises' as defined in the Explanation to Paragraph A(c) of Part I of the Schedule of the Wealth-tax Act, 1957, and thus exempt from additional wealth-tax?"

Binding judicial precedents conclude the issue raised. A Division Bench of this Court in CWT v. Hari Singh (1980) 123 ITR 558, held that where agricultural operations are carried on urban land, the land will fall within the definition of the expression "business premises" as provided in rule 1(i), Paragraph B, Part I, of the Schedule to the Wealth Tax Act, 1957, and would thus be entitled to exemption from the charge of additional wealth-tax on urban assets, under Paragraph A (2).

A similar view was expressed in CWT v. Devinder Kaur (1984) 141 ITR 234 (P & H). It may be pointed out here that the special leave petition filed against this judgment was also dismissed by the Supreme Court, and later this judgment was followed by the High Court of Kerala adopting the same view in CWT v. Mrs. Sara Vargese (1988) 170 ITR 436.

This reference is, consequently, answered in the affirmative in favour of the assessee and against the Revenue. There will, however, be no order as to costs.

M.B.A./1636/TReference answered.