YASMEEN HAMEED VS SPECIAL OFFICER OF WEALTH TAX, CIRCLE 34, ZONE-B, LAHORE
2001 P T D 1514
[Lahore High Court]
Before Nasim Sikandar and Jawwad S. Khawaja, JJ
Mrs. YASMEEN HAMEED
versus
THE SPECIAL OFFICER OF WEALTH TAX, CIRCLE‑34, ZONE‑B, LAHORE
I.T.As. Nos.323 to 328 and 332 to 33'7 of 2000, decided on 01/02/2001.
(a) Wealth Tax Act (XV of 1963)‑‑‑
‑‑‑‑S. 27‑‑‑Appeal to High Court‑‑‑Scope‑‑‑Question of fact‑‑‑Valuation of property‑‑‑Determination‑‑‑Contention of the assessee was that she was not owner of the property in question inasmuch as the same had been allotted to her with certain restrictions on. her right to dispose of the same and said conditions according to assessee being in derogation of the ownership rights, she was not owner of the property, and therefore, same was not liable to be taxed for wealth tax in her hands as an "asset "‑‑‑Inspecting Assistant Commissioner estimated the value of the land as well as the constructed portion at a certain rate which was partly maintained by the Tribunal to the extent of the valuation of the land‑‑‑Valuation so made by the Tribunal was at best a case of one estimated against the other and in such a situation, no question of law could be said to have arisen.
(b) Wealth Tax Act (XV of 1963)‑‑‑
‑‑‑‑S. 27‑‑‑Appeal to High Court‑‑‑Scope‑‑‑Only a question of law arising out of order of the Tribunal could be a subject‑matter of appeal before High Court.
(c) With Tax Act (XV of 1963)‑‑‑
‑‑‑‑S.27‑‑‑Wealth Tax Rules, 1963, R. 8(3)‑‑‑Reference to High Court‑‑ Scope‑‑‑Valuation of assets onless successfully demonstrated to be without a basis would not give rise to a question of law to be determined and answered by the High Court.
Ch. Anwar‑ul‑Haq for Appellant.
Shafqat Mahmood Chohan for the Revenue.
ORDER
NASIM SIKANDAR, J.‑‑‑This order will dispose of I.T.As. Nos.323 to 328 and 332 to 337 of 2000. These cross‑appeals under section 27 of the Wealth Tax Act, 1963 assail a common order recorded by the Lahore Bench of the Income Tax Appellate Tribunal on 31‑1‑2000.
2. The appellant is an individual and, an assessee of the Wealth Tax Department. Original assessments framed in her respect for the assessment years 1992‑93 to 1997‑98 were revised by the concerned I.A.C. after he found that she had been allotted a commercial plot by Lahore Cantt. Cooperative Housing Society measuring 5 Kanals which was not shown in her returns. The assessee claimed to have shown it as a part of business capital respectively for the years 1993‑94 to 1997‑98 at Rs.24,99,648, Rs.22,21,042, Rs.20,13,397, Rs.16,60,$65 and Rs.13,91,322. The I.A.C. noted that certain other assets such as furniture and fixtures had not been shown separately. Accordingly he revised the assessment by adopting the valuation of the plot as per D.C. rates notified under the Stamps Act and by taking the cost of constructed portion at Rs.300 per square feet.
3. Before the Tribunal, it was contended that the assessee was not owner of the property in question inasmuch as the same had been allotted to her with certain restriction on her right to dispose of the same. These conditions, according to the assessee being in derogation of the ownership rights, she was not owner of the property, and therefore, it was not liable to be taxed in her hands as an "assets" as defined in section 2(1)(5) of the Repealed Wealth Tax Act, 1963.
4. The learned Tribunal, however, disagreed on the admission of the learned A.R. that in case of the death of the assessee, her legal heirs will be entitled to inherit the plot as well as its building as per legal shares. The learned Tribunal then proceeded to hold that the asset was liable to be taxed in her hands. It was, however, noted that since the plot could not be used for a purpose other than educational, it could not fetch a price as a comparable commercial property. On that consideration, the Tribunal reduced the valuation of plot to Rs.75,000 per marla. The value of construction as adopted by the revising authority was, however, maintained.
5. The assessee still feeling aggrieved has filed these appeals while the Revenue considers the reduction in the price per marla to be against the facts of the case. The assessee claims that following questions of law have arisen out of the order of the Tribunal
(1) Whether on facts and circumstances of the case, is the appellant for the purpose of Wealth Tax absolute owner of the plot in question transferred in her name by the society in terms of the agreement, dated 15‑12‑1987? .
(2) Whether on the facts and circumstances of the case, was the appellant chargeable to wealth tax in respect of plot in question to the extent of her investment/interest in the plot of Rs.500,000 only, especially in terms of the agreement, dated 15‑12‑1987?
(3) Whether on the facts and circumstances of the case, was the Tribunal justified in confirming the valuation of the superstructure @ Rs.300 per sq/ft adopted in terms of section 3A of the Act?
(4) Whether on facts and circumstances of the case, when the declared capital of the appellant was accepted in strict compliance of law and the rules framed thereunder. Can, such assessment be declared erroneous in so far as prejudicial to the interests of the Revenue in terms of section 17‑B of the Act?
(5) Whether on facts and circumstances of the case, an order having been concluded in strict compliance of law can be attacked for the purpose of section 17‑B of the Wealth Tax on the basis of difference in conclusion and results by the revising authority?
(6) Whether on the facts and circumstances of the case, was the Tribunal justified in confirming the method of valuation adopted by the respondent No.2 in contradiction of Rule 8(3) of the Wealth Tax Rules, especially when the Tribunal itself had declared such method of valuation to be violated of rule referred supra?
(7) Whether on facts and circumstances of the case, does the "School" fall within the definition of "shop" owned and occupied by the appellant for the purpose of his own business in terms of clause 12(2) of the Second Schedule, Part‑I of the Act inserted vide Notification No. SRO 595 (1)/96, dated July 9, 1996?
(8) Whether on facts and circumstances of the case, was the show‑cause notice issued and the order framed under section 17‑B of the Act for the assessment years 1992‑93 to 1997‑98 pertaining to the period commenced from the first day of July, 1991 or 1992?
(9) Whether on the facts and circumstances, was the Tribunal justified to restrict the value of plot at Rs.75,000 per marla for all the assessment years, especially in view of the judgment of the Tribunal reported as 1997 PTD (Trib) 325?
(10) Whether on facts and circumstances of the case, has the respondent No.2 jurisdiction under section 17‑B of the Act to determine the value of building under rule 8(3) of the Wealth Tax Rules?
(11) Whether on the facts and circumstances of the case, when, as per master plan of the society the plot in question is situated in the residential area, the Tribunal was justified in confirming the rates prescribed for commercial property?
6. On the other hand, the Revenue assails the order of the Tribunal on the following grounds:‑‑
(a) That the order passed by the learned Member of the Income‑tax Appellate Tribunal is against the facts of the case and illegal.
(b) That the learned Members of the Tribunal have misdirected the law, as the valuation of the property was made on the basis of D.C. rates.
(c) That the learned Members of Tribunal could not appreciate the provisions of law relating to the Rule 8(3) of the Wealth Tax Act, 1963 for the purposes of the valuation of the properties.
7. After hearing both the parties, we are not persuaded to interfere for any of them. It will be seen that the ownership of the property in dispute was not denied as such. The stated restriction on its disposal did not effect the right of ownership nor it derogated from the same in any manner except that the next purchaser was to acquire the property for the same purpose for which it was allotted to the assessee. The condition so attached certainly could effect the number of buyers if the property was intended to be disposed of. However, as rightly concluded by the Tribunal it did not derogate from the fact that the petitioner was its owner. In fact the ownership of the property was finally not seriously contested after it was admitted that in case of death of the assessee her legal heirs will be entitled to inherit the same as per their legal shares.
8. That being the case, no question of law can possibly be said to have arisen out of the order of the Tribunal on that score. The revising authority estimated the value of land as well as the constructed portion on a certain rate which was partly maintained by the Tribunal to the extent of the valuation of the land. The valuation so made is at best a case of one estimated against the other. In such situation, again no question of law can be said to have arisen.
9. Also we have found that the issues with regard to chargability of plot in question, revising of the assessment by the I.A.C., if the school in question fell within the definition of shop, the vires of the show‑cause notice issued under section 14‑B and the effect of the location of the plot were not mooted before the Tribunal. Therefore, none of these questions can be said to have arisen out of the order of the Tribunal. It will be seen that only a B question of law arising out of the order of the Tribunal can be a subject‑matter of appeal before this Court.
10. The grounds of appeal as agitated by the Revenue are equally irrelevant as far the impugned judgment is concerned. The ground (a) as taken is a general statement of grievance of the petitioner. The grounds (b) and (c) again relate to the relief on merits which, as observed earlier, pertain to valuation of property keeping in view the standards laid down in Rule 8(3) of the Wealth Tax Rules, 1963. The value ton of an asset unless it can successfully be demonstrated to have been without a basis does not give rise to a question of law to be determined and answered by this Court.
11. Therefore, these cross‑appeals by the assessee as well as by the Revenue shall be dismissed.
M.B.A./Y‑3/LAppeals dismissed.