Wealth Tax Act (XV of 1963)---

----Ss. 2(16) & 16---Wealth Tax Rules, 1963, R.8(3)---Levy of Wealth Tax on land---Assessee's agricultural land was found located adjacent to his house and was treated as an urban immovable property chargeable to tax---Properties of assessee which had mostly been given on rent were subjected to tax at a rate which was higher than ten times of rented value of the property---Car was also added in the wealth while exemption in respect of a carrier wagon was also disallowed---No distinction existed between an urban agricultural land or rural agricultural land---Land wherever cultivated and so included in revenue record, could be held as an agricultural land---Test was that same was actually cultivated and land revenue was being paid on the same having so registered in the revenue record---Three out of four co-owners of land in question had been allowed exemption, but assessee had been denied the said exemption---Treatment to assessee, in circumstances being unjustified, Assessing Officer was directed to delete entire agricultural land from the wealth of assessee---Premises which had been given on rent by assessee, would be assessed at ten times of actual rent received by assessee and property, if any, which had not been let out would remain at the same value on which Commissioner Income Tax (Appeals) had assessed---Regarding car, Assessing Officer would confirm that assessee was not owner of any car and then exclude the same while calculating the tax afresh--Wagon, however was considered as taxable as no proof for its use for agricultural purpose had been produced at any stage of proceedings.

Mir Asad Khan for Appellant.

Mirza Khan, D.R. for Respondent.

Date of hearing: 2nd June, 2005.

ORDER

KHAWAJA FAROOQ SAEED (CHAIRPERSON).---All the four appeals have been filed by the assessee/appellant. The common issue in all-the four years is charge of agricultural land.

2. Brief facts leading to these appeals are that assessee is owner of a number of properties, these were subjected to tax for assessment years 1997-98 onwards against which appeals were filed. The assessee^'s agricultural land was found located adjacent to his house, hence was treated as an Urban immovable property chargeable to tax under the Wealth Tax Act (Repealed). Further, his properties which had mostly been given on rent were subjected to tax at a rate which is higher than ten times of the rental value of the said property. A car was also added in the wealth while exemption in respect of a carrier wagon was also disallowed.

3. The assessee before us argued that an agricultural land even if is located adjacent to the urban area can still remain as an agricultura^l if property is cultivated and accordingly shown in the revenue record. Since, neither any Colony has been proposed on these plots nor any plan for its urbaⁿization in any form has yet been initiated, its nature cannot be change^d.The department therefore, was not well within its legal justificatioⁿ to charge the same for tax. Regarding valuation of other properties he says that the same Assessing Officer has assessed income-tax returns where his rental value has been determined by him. Blowing cold in the income-tax and hot in respect of wealth tax proceedings has never been permitted by the superior Courts. Further the assessee was never owner of any car. Its inclusion in his net wealth on presumption is unfair. Similarly, the wagon having been used for the cultivation should have been allowed as exempt.

4. The DR says that the land is very near, rather adjacent to Ayub Medical College, which alone is enough to indicate its value. Regarding other properties he said that the same have been assessed under Rule 8(3) and the estimation after CIT(A) order does not need any interference. Regarding car he said that if there is some omission the same can be rectified for which set aside will be best option. However, the wagon apparently has never been used for agricultural purposes hence cannot be treated as a part of the said system. Besides, in this case the assessee is owner of few Kanals of land statedly less than 300, for which such a wagon is not required.

5. We have heard both. So far as the issue of agricultural land is concerned, there is no distinction between an Urban agricultural land or Rural agricultural land. A land wherever cultivated and so included in the revenue record can be held as an agricultural land. The test is that the same is actually cultivated and land revenue is being paid on the same having so registered in the revenue record. In the present case a very surprising treatment has been given. Three out of four co-owners of the said land have been allowed exemption and this assessee has been denied. This has been informed by the learned AR. This alone is enough to convince us that the treatment in unjustified and we accordingly direct the Assessing Officer to delete the entire agricultural land from the wealth of the assessee.

6. Regarding valuation of various properties, the premises which have been given on rent by the assessee shall be assessed at ten times of the actual rent received by the assessee and statedly accepted by the department in income-tax returns. Property if any which has not been let out shall remain at the same value on which the CIT(A) has assessed.

7. Regarding car the Assessing Officer shall confirm that the assessee was not owner of any car and then exclude the same while calculating the tax afresh. However, the wagon is considered as taxable as no proof for its use for agricultural purpose has been produced at any stage of the proceedings. This decides all the four appeals on the line and in the manner discussed above.

H.B.T./468/Tax (Trib.)???????????????????????????????????????????????? Order accordingly.