W.T.AS. NOS. 141 AND 142/LB OF 1987-88, DECIDED ON 20TH OCTOBER, 1994. VS W.T.AS. NOS. 141 AND 142/LB OF 1987-88, DECIDED ON 20TH OCTOBER, 1994.
1996 P T D (Trib.) 288
[Income-tax Appellate Tribunal Pakistan]
Before Syed Mumtaz Ali Gillani, Judicial Member and Abdul Malik, Accountant Member
W.T.As. Nos. 141 and 142/LB of 1987-88, decided on 20/10/1994.
Wealth Tax Rules, 1963---
----R. 8(3)---C.B.R. Circular No.C.14(7)IT/6/WT/79, dated 20-8-1979-- C.B.R. Circular No. 11 of 1994, dated 17-7-1994---Immovable property-- Valuation---Principles---Registered sale-deed---Evidentiary value---Held, registered sale-deed could not be belied---Assessing Officials could not use arbitrarily the powers and adopt coercive measures for evaluation of property on the rise side each and every year for the purposes of wealth tax for such exercise of power would be against the principles of natural justice.
Ch. Allah Ditta Randhawa for Appellant.
Javed Aziz, D.R. for Respondent.
Date of hearing: 18th October, 1994.
ORDER
SYED MUMTAZ ALI GILLANI (JUDICIAL MEMBER). ---This order will dispose of both the appeals for the years 1983-84 and 1984-85.
2. The appellant has urged a common point i.e. evaluation of the properties involved as under:---
ASSESSMENT YEAR 1983-84:
(1) Shop No. 30, Nishat Road, Multan: Enhancement of Rs.55,000 to Rs.60,000 is not justified.
(2) 1 Kanal Plot at Abdali Road, Multan: Assessed at Rs. 3,00,000 and confirmed in appeal is unjustified.
(3) Plot No. 100 Overseas Karachi: Assessed at Rs.400,000 and confirmed by the A.A.C. is illegal as PT- I has determined the value at Rs.14,400.
(4) Plot No. 3 Ishrat Corporation, Karachi: Assessed at Rs.1,30,000 being in contest.
(5) Share in Property No. 3028 Akbar Road, Multan: Assessed at Rs.35,000 being in contest.
ASSESSMENT YEAR 1984-85
(1) Shop No.30, Nishat Road, Multan: Valuation adopted at Rs.70,000 being excessive one.
(2) Plot at Abdali Road, Multan: Assessed at Rs.3,25,000 is also excessive.
(3) No. 100 Overseas, Karachi: Valuation adopted at Rs.6,00,000 is on the high side.
(4) Plot B-3, Ishrat Colony, Karachi: Assessed at Rs. 1,40,000 is also excessive.
(5) Plot No. 69 in the name of wife assessed at Rs.2,00,000 is contested.
(6) Share in Property No.3028 Akbar Road, Multan assessed at Rs.40,000 is also excessive.
(7) Plot No. 110 Babar Block, New Garden Town. Lahore, assessed at Rs.5,40,000 is not justified.
3. It is argued by the A.R. of the appellant that values of the plot and properties has been assessed arbitrarily by passing the Circulars issued from the Central Board of Revenue from time to time and he has drawn our attention to the Circular No. C. No. 14(7) IT/6/W.T./79, dated 20-8-1979 whereas under the note of instructions issued to the Officers it is said:
(a) Value of property.-- The value of houses which are let out shall normally be determined by capitalizing the gross annual rental value for ten years.
(b) Self-occupied houses.--Where an assessee does not exercise the option in favour of a self-occupied house but opts to avail of the full concession of non-taxable value of Rs.5 lacs, the house will be valued normally by capitalizing the gross annual rental value for ten years, if it was previously let out.
(e) In respect of commercial plots located in approved housing schemes where the allotment authority fixes the value of the plot, the value for wealth tax purposes in case of original allottees will be the cost of them and fixed by the authority; in other cases, the actual purchase price of the plot shall be taken as the value of the plot.
(d) Commercial Buildings and shoes.--The valuation will be the cost of the building to the assessee in case it is being used by him and has not been rented out, if the building has been rented out the value will be the capitalized rent over a period of ten years.
4. The appellant has further relied on Circular No. 11 of 1994 of the C.B.R. on wealth tax where it has been laid down that the value of land shall be taken equal to the value specified by the District Collector for the purpose of stamp duty. He has also invited our attention to the Income Tax Appellate Tribunal judgment 1986 PTD (Trib.) 83 where it was laid down that Gift Tax Officer cannot enhance the market value of the property on estimate basis.
5. The D.R. on behalf of respondent has argued that the A.A.C. has lawfully confirmed the value of Shop No. 30, Nishat Road, Multan at Rs.60,000 and Rs.70,000 on the basis of monthly rent of Rs.500 per month. He has urged that valuation of Plot at Abdali Road was disclosed in 1983-84 at Rs.1,00,000 and it was purchased on 16-3-1978. In view of .the capital value taken at Rs.12,500 per Marla the A.A.C. has rightfully confirmed the same at Rs.3,00,000 in 1983-84 and Rs.3,25,000 in 1984-85. Similarly the D.R. has further supported view taken by the A.A.C. in respect of plot No. 100 Overseas, Karachi the value of which was confirmed at Rs.4,00,000 and Rs.6,00,000 respectively. He has further supported to valuation of plot No.3-B, Ishrat Corporation, Karachi at Rs.1,00,000. He has also dilated upon the reasonableness of the value of Rs.2,00,000 about the Plot 69 Block-III, Canal Housing Society, Lahore and has also supported the view of A.A.C. evaluating. Plot No. 110, Garden Town, Lahore at Rs.15,40,000.
6. In view of the considered opinions of Authorities from time to time, the settled issue as regards evaluation of immovable property for the purpose of wealth tax it is treated against the principles of justice to allow the assessing officials to use arbitrarily the powers and adopt coercive measures, the value of property for the purposes of wealth tax are not placed to be taken on the rise side each and every year. Hence as such in the case of appellant for the year 1983-84 the enhancement of valuation from Rs.55,000 to Rs.60,000 in respect of Shop No.30, Nishat Road, is unjustified and the same be treated at Rs.55,000 for the year 1983-84 and 1984-85. The valuation of plot of one Kanal at Abdali Road, Multan declared at Rs.1,00,000 in the years 1983-84, 1984-85 and' 1985-86, we are not in agreement with the appellant as it was vacant plot and was purchased as back as on 16-3-1978 and taking capital value at Rs.12,500 per Marla, we confirm the same at Rs.3,00,000 for the year 1983-84 but do not confirm the value of this plot at Rs.3,25,000 for the year 1984-85 the same would be treated at Rs.3,00,000 for the year 1984-85. The value of Plot No. 100, Overseas Housing Society, Karachi was declared to be at Rs.3,63,000 and Rs.5,63,000 respectively for the years 1983-84 and 1984-85. Since the assessee made huge construction on this plot which was purchased on 12-7-1978 and the assessee could not produce any proof of the cost of construction and expenses incurred thereon the assessing officer in absence of any evidence was justified in rejecting the declared version and adopted the same at Rs.400,000 and Rs.6,00,000 respectively, hence, no interference is called for on this issue. The valuation regarding Plot No. 3, Ishrat Corporation being reasonable is upheld -at Rs.1,30,000 for both the years 1983-84 and 1984-85. The appellant's share in property No.3028, Akbar Road, Multan assessed at Rs.35,000 as against declared one at Rs.20,000 being not on the excessive side is confirmed at Rs.35,000 for both the years 1983-84 and 1984-85. For the year 1984-85, Plot No.69, Canal Housing Society, Lahore which was declared at Rs.1,76,500 the assessing officer in absence of evidence of cost of construction adopted the value at Rs.2,00,000 which was cottfirme4 in appeal. This being a rational view, hence, needs no interference. As regards Plot No. l and 10 Babar Block, Model Town, Lahore which was declared at Rs.4,10,000, the assessing', officer in absence of any evidence keeping in view the measurement of the Plot i.e. 3 Kanals 17 Marlas situated in a splendid new locality of Lahore adopted the price at Rs.15,000 per Marla thus evaluating the price at Rs.15,40,000 the assessee purchased this plot on 15-4-1984 for a consideration of Rs.3,80,000 plus expenses incurred Rs.30,000 making value at Rs.4,10,000. It seems that the Registered deed of the plot was presented before the W.T.O. but he did not take the same into consideration because according to him the purchase deeds are grossly understated in order to avoid stamp duty and since the plot is situated in the heart of Lahore he took the market value at Rs.20,000 per Marla, His view was upheld in appeal by the A.A.C. To our mind this is erroneous view registered deeds can never be belied and moreover, the Circulars relied upon by the appellant also enhance their importance for the purposes of the valuation of the property for the purposes of wealth tax. So view taken by the W.T.O. and A.A.C. being unjust, unlawful is rejected and value of the said property is confirmed at Rs.4,10,000 both for the years 1983-84 and 1984-85.
Both the appeals through this single order stand disposed of accordingly.
M.B.A./152/Trib.
Order accordingly.