Rajendra M. Dev & Build Private Limited, Mumbai V. Assistant Commissioner of Wealth-tax, Central Circle - 1, Nashik

CO 75/PUN/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 1193 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 14 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 11-09-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-05-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 28-08-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHRI; K K OJHA
• Assessee Lawyers: DR SUNIL PATHAK
• Keywords: Search and seizure; Question of law; Fair market value; Valuation report; Competent authority; Tax effect
• Section: 201; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / WTA NO S . 33 TO 35 /P U N/201 7 / ASSESSMENT YEAR S : 2008 - 09, 2009 - 10 & 2014 - 15 THE ASST. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / APPELLANT VS. RAJENDRA M. DEV. & BUILD PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI - 400001 . / RESPONDENT PAN: AAACR2040N . /CO NOS . 74 TO 76/ PUN/201 7 / ASSESSMENT YEAR S : 2008 - 09, 2009 - 10 & 2014 - 15 (ARISING OUT OF WTA NOS.33 TO 35/PUN/2017 ) RAJENDRA M. DEV . & BUILD PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI - 400001 . / CROSS OBJECT OR PAN: AAACR2040N VS. THE ASST. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / RESPONDENT W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 2 . / WTA NO S . 8 & 9 /P U N/201 9 / ASSESSMENT YEAR S : 2010 - 11 & 2011 - 12 THE DY. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / APPELLANT VS. RAJENDRA M. DEV. & BUILD PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI - 400 001 . / RESPONDENT PAN: AAACR2040N . /CO NOS . 10 & 11/ PUN/201 9 / ASSESSMENT YEAR S : 2010 - 11 & 2011 - 12 (ARISING OUT OF WTA NOS.8 & 9/PUN/2019 ) RAJENDRA M. DEV. & BUILD PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI - 400001 . / CROSS OBJECT OR PAN: AAACR2040N VS. THE DY. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / RESPONDENT . / WTA NO S . 07 TO 12 /P U N/201 7 / ASSESSMENT YE AR S : 200 8 - 0 9 TO 201 3 - 1 4 THE ASST. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / APPELLANT VS. RUDRAKSHA BUILDERS PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI - 400001 . / RESPONDENT PAN: AAAC R7417D W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 3 . /CO NOS . 48 TO 53/ PUN/201 7 / ASSESSMENT YEAR S : 2008 - 09 TO 2013 - 14 (ARISING OUT OF WTA NOS.07 TO 12/PUN/2017 ) RUDRAKSHA BUILDERS PVT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI 400001 . / CROSS OBJECT OR PAN: AAACR7417D VS. THE ASST. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE - 1, NASHIK . / RESPONDENT . / WTA NO S . 62 TO 66 /P U N/201 7 / ASSESSMENT YEAR S : 2010 - 11 TO 2014 - 15 PARIWAR MARKETING P VT. LTD., 37/39, KANTOL NIWAS, MODI STREET, FORT, MUMBAI 400001 . / APPELLANT PAN: AABCP1745P VS. THE ASST. COMMISSIONER OF WEALTH TAX, CENTRAL CIRCLE 1, NASHIK . / RESPONDENT ASSESSEE BY : DR. SUNIL PATHAK REVEN UE BY : S HRI K.K. OJHA & SHRI PANKAJ GARG / DATE OF HEARING : 21.08. 201 9 / DATE OF PRONOUNCEMENT: 11 . 0 9 .201 9 W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 4 / ORDER PER SUSHMA CHOWLA, J M : OUT OF T HIS BUNCH OF APPEAL S , APPEALS FILED BY REVENUE ARE AGAINST RESPECTIVE ORDER S OF COMMISSIONER OF WEALTH TAX (APPEALS), RELATING TO ASSESSMENT YEAR S 2008 - 09 TO 2014 - 15 AGAINST RESPECTIVE ORDER S PASSED UNDER DIFFERENT SECTION S OF THE WEALTH - TAX ACT , 19 57 (IN SHORT THE ACT) . THE ASSESSEE ALSO FILED CROSS OBJECTIONS AGAINST THE SAID APPEALS. FURTHER, ASSESSEE IN THE CASE OF PARIWAR MARKETING PVT. LTD. HAS FILED APPEALS AGAINST CONSOLIDATED ORDER OF CWT(A) 12, PUNE DATED 20.07.2017. 2. FIRST, WE SHALL TAKE UP APPEALS FILED BY REVENUE IN THE CASE OF RAJEN DRA M. DEV. & BUILD PVT. LTD. THE REVENUE HAS FILED APPEALS FOR ASSESSMENT YEARS 2008 - 09 TO 201 1 - 1 2 & 2014 - 15 , AGAINST WHICH THE ASSESSEE HAS RAISED THE CROSS OBJECTIONS. FIRST, WE TAKE UP APPEAL OF REVENUE AND CROSS OBJECTION OF ASSESSEE RELATING TO ASS ESSMENT YEAR 2008 - 09. 3 . DURING THE COURSE OF HEARING, IT WAS POINTED OUT BY THE LEARNED AUTHORISED REPRESENTATIVE THAT THE MONETARY LIMITS FOR FILING THE APPEALS BY THE REVENUE BEFORE THE INCOME TAX TRIBUNAL HAVE BEEN ENHANCED BY THE CIRCULAR NO.17/2019 DATED 08.08.2019. IT WAS FURTHER POINTED OUT BY HIM THAT CONSEQUENT TO THE SAID CIRCULAR, MANY OF THE PRESENT APPEALS FILED BY THE REVENUE AGAINST THE WEALTH TAX ASSESSMENTS MADE AGAINST ASSESSEE , ARE NOT MAINTAINABLE , AS THE CBDT VIDE CIRCULAR NO. 17 /20 19 DATED 0 8 .0 8 .2019 HAD PRESCRIBED ENHANCED LIMITS FOR FILING / WITHDRAWAL OF APPEALS BEFORE THE TRIBUNALS ; FURTHER CBDT VIDE CIRCULAR NO.5 OF 2019 HAD DIRECTED THE MONETARY W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 5 LIMITS WHICH WERE PROPOSED BY THE CBDT CIRCULAR NO.3/2018 DATED 11.07.2018 IN RES PECT OF INCOME TAX APPEALS , WILL ALSO APPLY TO THE WEALTH - TAX APPEALS ; CONSEQUENT THERETO, THE APPEALS WHEREIN THE TAX EFFECT IS LESS THAN RS.50 LAKHS WOULD NOT BE MAINTAINABLE. 4 . THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE POINTED THAT THE M ONETARY LIMITS HAVE BEEN ENHANCED FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE INCOME TAX TRIBUNALS VIDE CIRCULAR NO.17/2019 DATED 08.08.2019 AT RS.50 LAKHS. 5 . THE LEARNED AUTHORISED REPRESENTATIVE FOR THE ASSESSEE ALSO POINTED OUT THAT IN ALL THOS E APPEALS WHERE THE TAX EFFECT IS LESS THAN THE LIMITS PRESCRIBED BY THE CBDT, THE CROSS - OBJECTIONS FILED BY THE ASSESSEE WOULD BECOME ACADEMIC. 6 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE CBDT VIDE CIRCULAR NO.3/2018 DATED 11.07. 2018 WITH A STEP TO REDUCE THE LITIGATION BEFORE THE INCOME TAX APPELLATE TRIBUNALS, HONBLE HIGH COURTS AND HONBLE SUPREME COURT HAD REVISED THE MONETARY LIMITS FOR FILING THE APPEALS AND HAD PRESCRIBED THAT WHERE THE APPEAL EFFECT IS LESS THAN RS.2 0 LAKHS , THEN SUCH APPEALS WOULD BE WITHDRAWN BY THE REVENUE DEPARTMENT AND WOULD NOT BE PRESSED BY THE AUTHORITIES. IN THIS REGARD, UNDER PARA 3, THE LIMITS BEFORE THE RESPECTIVE AUTHORITIES WERE PRESCRIBED AND VIDE PARA 5, THE STEPS FOR WITHDRAWALS OF THE APPEALS BEFORE THE AUTHORITIES WERE PROVIDED. 7 . CONSEQUENT THERETO, CBDT PASSED ANOTHER CIRCULAR NO.5/19 DATED 05.02.2019 AND POINTED OUT THAT AS A STEP TOWARDS LITIGATION MANAGEMENT; THE W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 6 BOARD HAS DECIDED THAT THE MONETARY LIMITS FOR FILING OF APPE ALS IN INCO ME - TAX APPEALS, WOULD ALSO APPLY TO WEALTH - TAX MATTERS, THROUGH EXTENSION OF THE CIRCULAR TO WEALTH - TAX MATTERS IN A MUTATIS MUTANDIS MANNER AND WITH MODIFICATIONS AS PRESCRIBED UNDER. THE PARA 4 OF THE EARLIER CIRCULAR DATED 11.07.2018 WAS A MENDED AND IT WAS PRESCRIBED AS UNDER : - ' FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERENCE BETWEEN THE TAX ON NET WEALTH ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH NET WEALTH BEEN REDUCED BY THE AMOUNT OF WEALTH IN RESPECT OF THE ISSU ES AGAINST WHICH APPEALS IS INTENDED TO BE FILED. HOWEVER, THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST .' 8 . IT WAS FURTHER PROVIDED THAT THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE SHALL NOT APPLY TO WRIT MATTERS.. THE SAID EXTENSION OF THE CIRCULAR TO WEALTH - TAX APPEALS CAME INTO EFFECT FROM THE DATE OF THE ISSUE OF THE SAID CIRCULAR. 9. NOW THE CBDT VIDE ITS CIRCULAR NO.17/2019 DATED 08.08.2019 HAS AMENDED PARA 3 OF THE CIRCULAR UNDER WHICH THE LIM ITS FOR FILING THE APPEALS BEFORE THE AUTHORITIES HAS BEEN ENHANCED ; IN RESPECT OF APPEALS AT TRIBUNAL, IT IS RS.50 LAKHS, BEFORE THE HON'BLE HIGH COURTS, IT IS RS.1CRORE AND BEFORE THE HONBLE SUPREME COURT, IT IS RS. 2 CRORE. 10 . FURTHER, IN ORDER TO B RING AT PAR, THE STATUS OF APPEALS DECIDED BY SEPARATE ORDERS FOR EACH ASSESSMENT YEARS VIS - - VIS COMPOSITE ORDERS FOR MORE THAN ONE ASSESSMENT YEAR, PARA 5 OF THE CIRCULAR IS ALSO SUBSTITUTED WHICH READS AS UNDER : '5. THE ASSESSING OFFICER SHALL CALCULAT E THE TAX EFFECT SEPARATELY FOR EVERY ASSESSMENT YEAR IN RESPECT OF THE DISPUTED ISSUES IN THE CASE OF EVERY ASSESSEE. IF, IN THE CASE OF AN ASSESSEE, THE DISPUTED ISSUES ARISE IN MORE THAN ONE ASSESSMENT YEAR, APPEAL CAN BE FILED IN RESPECT OF SUCH ASSESS MENT YEAR OR YEARS IN WHICH THE TAX EFFECT IN RESPECT OF THE DISPUTED ISSUES EXCEEDS THE W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 7 MONETARY LIMIT SPECIFIED IN PARA 3. NO APPEAL SHALL BE FILED IN RESPECT OF AN ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIE D IN PARA 3. FURTHER, EVEN IN THE CASE OF COMPOSITE ORDER OF ANY HIGH COURT OR APPELLATE AUTHORITY WHICH INVOLVES MORE THAN ONE ASSESSMENT YEAR AND COMMON ISSUES IN MORE THAN ONE ASSESSMENT YEAR, NO APPEAL SHALL BE FILED IN RESPECT OF AN ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIED IN PARA 3. IN CASE WHERE A COMPOSITE ORDER/ JUDGEMENT INVOLVES MORE THAN ONE ASSESSEE. EACH ASSESSEE SHALL BE DEALT WITH SEPARATELY.' 11 . THE CBDT ALSO ISSUED A LETTER DATED 20.08.20 18 UNDER WHICH IT HAS BEEN CLARIFIED THAT THE ENHANCED MONETARY LIMITS WOULD APPLY TO PENDING APPEALS. 1 2. IN SUCH A BACKGROUND, WE HOLD THAT WHERE PARA 4 OF THE EARLIER CIRCULAR DATED 11.07.2018 WAS AMENDED TO EXTEND THE WITHDRAWAL FACILITY OF APPEALS TO WEALTH - TAX APPEALS STANDS, AND ONLY PARA 3 AND PARA 5 HAVING BEEN AMENDED BY THE LATER CIRCULAR DATED 08.08.2019, THEN IN SUCH A SCENARIO, THE ENHANCED LIMITS FOR WITHDRAWALS OF APPEALS FILED BY THE AUTHORITIES WOULD ALSO SQUARELY BE APPLICABLE TO WEALT H - TAX APPEALS FILED BY THE REVENUE BEFORE THE AUTHORITIES. ACCORDINGLY, IN CASES WHERE THE TAX EFFECT IS LESS THAN RS.50 LAKHS IN INDIVIDUAL YEARS, THEN EVEN IF THE APPEALS HA D BEEN DECIDED BY THE CONSOLIDATED ORDER BY THE COMMISSIONER OF WEALTH TAX (APP EALS), THE ENHANCED MONETARY LIMIT OF RS.50 LAKHS WOULD APPLY TO EACH OF THE YEAR UNDER APPEAL AND THE APPEALS FILED BY THE REVENUE IN THIS REGARD WOULD NOT BE MAINTAINABLE. 1 3 . THE ASSESSEE IS IN APPEAL BEFORE US FOR ASSESSMENT YEARS STARTING FROM ASSESS MENT YEARS 2008 - 09 TO 2011 - 12 AND ON PERUSAL OF THE RESPECTIVE ASSESSMENT YEARS, IT IS CLEAR THAT THE TAX EFFECT IN THOSE APPEALS IS LESS THAN THE MONETARY LIMITS PRESCRIBED BY THE REVISED CIRCULAR OF RS.50 LAKHS. THE YEAR - WISE DETAILS ARE AS UNDER : W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 8 AS ST.YEAR ASSESSED WEALTH IN RS. TAX DEDUCTED IN RS. 2008 - 09 37 , 61,82,198/ - 37,46,821/ - 2009 - 10 36 , 84,25,588/ - 36,84,255/ - 2010 - 11 35 , 29,87,739/ - 35,29,877/ - 2011 - 12 22 , 14,53,502/ - 22,14,535/ - 1 4 . AS THE TAX EFFECT IN ASSESSMENT YEARS 2008 - 09 TO 2011 - 12 IS LESS THAN THE MONETARY LIMITS FIXED UNDER THE REVISED CIRCULAR OF CBDT, HENCE, THE APPEALS OF THE REVENUE FOR ASSESSMENT YEARS 2008 - 09 TO 2011 - 12 ARE NOT MAINTAINABLE AND THE SAME ARE DISMISSED. 1 5 . THE CROSS - OBJECTIONS FILED BY THE ASSESSEE WOULD BECOME ACADEMIC AND THE SAME ARE ALSO DISMISSED FOR THE ASSESSMENT YEARS 2008 - 09 TO 2011 - 12. 1 6 . NOW COMING TO THE APPEAL OF REVENUE FOR ASSESSMENT YEAR 2014 - 15, THE LEARNED AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FAIRLY POINTED OUT THAT THE ISSUE R AISED IN PRESENT APPEAL OF THE REVENUES STAND DECIDED AGAINST ASSESSEE BY THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SAROVAR HOTELS PVT. LTD., VS. DCWT IN WEALTH TAX APPEAL NOS.414, 415, 418, 425 AND 426 OF 2016 WITH LEAD ORDER IN WEALT H TAX APPEAL NO.414 OF 2016 JUDGMENT DATED 03.12.2018. THE LEARNED AUTHORISED REPRESENTATIVE FOR THE ASSESSEE ALSO POINTED OUT THAT THE ONLY ISSUE WHICH NEEDS TO BE DECIDED NOW IS THE VALUATION OF THE LAND AND THE ALLOWABILITY OF DEBTS AGAINST THE SAID VALUE OF THE LAND, WHICH ARE THE ISSUES RAISED IN THE CROSS - OBJECTIONS. 1 7 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE WHICH ARISES IN THE APPEALS FILED BY THE REVENUE IS WHETHER THE LANDS OWNED BY W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 9 THE ASSESSEE FALLS WITHIN TH E DEFINITION OF URBAN - LAND AS PER EXPLANATION 1(B) OF SEC.2(EA) OF THE WEALTH - TAX ACT. THE CASE OF THE REVENUE BEFORE US IS THAT THE AFORESAID AGRICULTURAL LANDS WERE CONVERTED TO NON - AGRICULTURAL LANDS AS ON THE DATE OF VALUATION AND THERE WAS NO PROHI BITION ON CONSTRUCTION BY LAW ON THE AFORESAID LANDS. THE ASSESSING OFFICER HELD THE VALUE OF SAID NON - AGRICULTURAL LAND WAS TO BE INCLUDED AS TAXABLE ASSET IN THE HANDS OF THE ASSESSEE. THE COMMISSIONER OF WEALTH TAX (APPEALS) ON THE OTHER HAND, HELD THAT THE SAID LANDS TO BE EXEMPT FROM WEALTH - TAX AS ON THE VALUATION DATE, AS NO CONSTRUCTION WAS PERMISSIBLE ON THE LAND. RELIANCE WAS ALSO PLACED ON THE DECISION OF PUNE BENCH OF T HE TRIBUNAL IN THIS REGARD AND REFERENCE WAS ALSO MADE TO VARIOUS OTHER DECISIONS. THE COMMISSIONER OF WEALTH TAX (APPEALS) HELD THAT BOTH THE AGRICULTURAL LANDS AS WELL AS NON - AGRICULTURAL PLOTS OF LAND WERE TO BE EXCLUDED FROM THE NET WEALTH OF THE ASSESSEE. THE CASE OF THE ASSESSEE TIME AND AGAIN HAS BEEN THAT THOUGH TH E LAND FALLS IN THE JURISDICTION WHERE CONSTRUCTION WAS ALLOWABLE , BUT IN THE ABSENCE OF THE ASSESSEE HAVING SOUGHT ANY PERMISSION FOR CONSTRUCTION AND / OR NO SUCH PERMISSION FOR CONSTRUCTION BEING GRANTED AND ALSO NO CONSTRUCTION BEING CARRIED OUT ON T HE DATE OF VALUATION , THE SAID LAND WAS EXEMPT FROM WEALTH - TAX. 18. THE HONBLE BOMBAY HIGH COURT IN SAROVAR HOTELS PVT. LTD., VS. DCWT (SUPRA) WHILE DECIDING THE TAXABILITY TO WEALTH - TAX OF THE LANDS IN QUESTION WHERE NO CONSTRUCTION COULD HAVE BEEN CA RRIED OUT WITHOUT PERMISSION OF THE COMPETENT AUTHORITY AND WHERE NO SUCH PERMISSION WAS GRANTED AT THE RELEVANT TIME, UPHELD THE ORDER OF THE TRIBUNAL IN HOLDING THAT THE LANDS IN QUESTION WERE URBAN LAND, INCLUDABLE IN ASSESSEES NET WEALTH. REFERRING TO THE DEFINITION OF TERM URBAN - LAND AS EXPLAINED IN CLAUSE (B) OF EXPLANATION 1 OF SECTION 2(EA) OF THE WEALTH - TAX ACT , THE HONBLE HIGH COURT HELD AS UNDER : W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 10 13 THIS DEFINITION EXCLUDES FROM THE TERM 'URBAN LAND' ON WHICH CONSTRUCTION OF A BUILDING IS NOT PERMISSIBLE UNDER ANY LAW FOR THE TIME BEING IN FORCE. THIS EXPRESSION THE CONSTRUCTION OF BUILDING NOT PERMISSIBLE UNDER ANY LAW IN FORCE, CANNOT BE EQUATED WITH REGULATORY REQUIREMENT OF ANY STATUTORY PROVISION WHICH MANDATES OBTAINING OF PERMISSI ON FROM THE COMPETENT AUTHORITY BEFORE ANY CONSTRUCTION CAN BE CARRIED OUT. CONSTRUCTION BEING NOT PERMISSIBLE IS NOT THE SAME THING AS THE CONSTRUCTION THOUGH PERMISSIBLE, MUST BE AFTER OBTAINING SANCTION OF THE PRESCRIBED AUTHORITY. THE TRIBUNAL, THEREF ORE, WAS PERFECTLY CORRECT IN COMING TO THE CONCLUSION THAT THIS EXCLUSION CLAUSE WOULD NOT AID THE ASSESSEE. IN ANY URBAN AREA OR FOR THAT MATTER IN ANY AREA, PERMISSION FOR CONSTRUCTION IS ALWAYS REGULATED THROUGH STATUTORY PROVISIONS. UNLESS THE PRESCRI BED AUTHORITY - SUCH AS - MUNICIPALITY OR LOCAL AUTHORITY, APPROVES BUILDING PLAN AND GRANTS PERMISSION FOR CONSTRUCTION, NO CONSTRUCTION CAN BE PUT UP ON ANY LAND. SUCH A REGULATORY MECHANISM MAY ALSO HAVE CATEGORICAL RESTRICTIONS OR DIVISIONS, SUCH AS, I N CERTAIN AREAS, ONLY LIMITED TYPE OF DEVELOPMENT MAY BE PERMITTED. THESE, CONTROLS OR REGULATORY MECHANISM CANNOT BE EQUATED WITH CONSTRUCTION OF A BUILDING NOT BEING PERMISSIBLE ON THE LAND IN QUESTION. THE TRIBUNAL WAS CORRECT IN RECORDING THAT ASSESSEE HAD NOT BROUGHT ANY SUCH PROHIBITION IN LAW TO THE NOTICE OF THE TRIBUNAL. IT IS WELL ACCEPTED PRINCIPAL THAT RESTRICTION AND PROHIBITION ARE TWO DIFFERENT CONCEPTS. BUILDING REGULATIONS MAY AMOUNT TO RESTRICTION OF DEVELOPMENT OF LAND BUT NOT PROHIBITION OF PUTTING UP CONSTRUCTION THEREON. ASSESSEE IS NOT RIGHT IN CONTENDING THAT UNTIL SUCH PERMISSION IS GRANTED, IT REMAINS A LAND ON WHICH CONSTRUCTION IS PROHIBITED BY LAW. 14 THE CONTENTION OF THE COUNSEL FOR THE ASSESSEE THAT NO PERMISSION HAVING BEEN G RANTED, SAME MAY BE EQUATED WITH THE CONSTRUCTION NOT BEING PERMISSIBLE, IS NOT A CORRECT INTERPRETATION OF THE RELEVANT PROVISIONS. IF WE ACCEPT THE CONTENTION, AS WAS RAISED BEFORE US, IT WOULD AMOUNT TO ADDING A REQUIREMENT IN THE EXCLUSION CLAUSE, WHIC H THE LEGISLATURE HAS NOT PRESCRIBED. IN OUR OPINION, THEREFORE, THERE IS A CLEAR DISTINCTION BETWEEN A CASE WHERE THE CONSTRUCTION OF A BUILDING IS NOT PERMISSIBLE UNDER ANY LAW FOR THE TIME IN FORCE AND WHERE CONSTRUCTION THOUGH PERMISSIBLE, MUST BE PREC EDED BY PERMISSION, APPROVAL OR SANCTION FROM THE PRESCRIBED AUTHORITY. COUNSEL FOR THE ASSESSEE HAD ARGUED THAT THE WEALTH TAX IS TO BE COMPUTED ON THE BASIS OF NET WEALTH OF AN ASSESSEE ON THE PRESCRIBED DATE ON WHICH CONSTRUCTION OF A BUILDING WAS NOT PERMISSIBLE ON THE LAND IN QUESTION. IN OUR OPINION, THIS ARGUMENT BEGS THE QUESTION. AS HELD BY US, REQUIREMENT OF PERMISSION FOR CONSTRUCTION WOULD NOT MAKE CONSTRUCTION ON THE LAND IMPERMISSIBLE. THIS BEING THE POSITION, AS ON WHICH DATE SUCH REQUIREMEN T IS BEING TESTED WOULD BE OF NO CONSEQUENCE. IN OUR OPINION, THEREFORE, QUESTION (A) RAISED BY ASSESSEE, DOES NOT GIVE RISE TO ANY SUBSTANTIAL QUESTION OF LAW, 15 WITH RESPECT OF QUESTIONS (B) AND (C), HOWEVER, WE ARE OF THE OPINION THAT TRIBUNAL SHOULD C ONSIDER THESE QUESTIONS AND PASS A FRESH ORDER. THIS IS SO SINCE THOUGH RAISED, THE TRIBUNAL HAS NOT CONSIDERED THESE ISSUES. AS NOTED, QUESTION NO.(B) ARISES IN APPEAL NO. 418 AND 415 OF 2016, THE ASSESSEE WOULD BE ALLOWED TO ARGUE QUESTION (B) IN RELATIO N TO THOSE APPEALS. QUESTION (C) ARISES IN ALL THE APPEALS BUT WITH RESPECT OF SRI PERUMBUDUR LAND ONLY. 1 9 . THE DICT ATE OF THE HON'BLE HIGH COURT IN THE AFORESAID CASE IS THAT THERE WAS CLEAR DISTINCTION BETWEEN A CASE WHERE THE CONSTRUCTION OF A BUILDI NG IS NOT PERMISSIBLE UNDER ANY LAW FOR THE TIME IN FORCE AND WHERE CONSTRUCTION THOUGH PERMISSIBLE, MUST BE PRECEDED BY PERMISSION, APPROVAL OR SANCTION FROM THE W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 11 PRESCRIBED AUTHORITY. THE HON'BLE HIGH COURT HELD THAT REQUIREMENT OF THE PERMISSION FOR C ONSTRUCTION WOULD NOT MAKE CONSTRUCTION ON THE LAND IMPERMISSIBLE. IN OTHER WORDS, THE ASSET ON WHICH CONSTRUCTION COULD BE CARRIED OUT, THOUGH ON THE PRESCRIBED DATE NO SUCH PERMISSION WAS GRANTED BY THE COMPETENT AUTHORITY FOR CONSTRUCTION OR WHERE SUCH CONSTRUCTION WAS NOT UNDERTAKEN BY THE ASSESSEE , WOULD NOT CHANGE THE STATUS OF THE LAND F ROM URBAN - LAND UNDER SEC.2(EA) OF THE WEALTH TAX ACT. 20. APPLYING THE SAID RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SAROVER HOTELS PVT. LTD., (SUPRA), WE HOLD THAT THE LANDS IN QUESTION WHICH WERE NON - AGRICULTURAL LANDS AND AGAINST WHICH PERM ISSION COULD BE GRANTED IN FUTURE FOR CONSTRUCTION OF THE BUILDING , THOUGH NOT GRANTED ON THE VALUATION DATE , ARE URBAN LANDS AS DEFINED U/S 2(EA) O F THE ACT AND VALUE OF SUCH LANDS ARE THUS TO BE INCLUDED IN THE NET WEALTH OF THE ASSESSEE. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO INCLUDE THE VALUE OF SUCH URBAN LANDS , AS ON THE VALUATION DATE , IN THE HANDS OF THE ASSESSEE. 21 . THE ASSESSE E VIDE ITS CROSS - OBJECTIONS HAS RAISED THE ISSUE OF VALUATION OF THE LAND AS ON VALUATION DATE. WE FIND MERIT IN THE PLEA OF THE ASSESSEE AND IN THIS REGARD, THE ASSESSING OFFICER IS THUS DIRECTED TO DETERMINE THE VALUE OF THE AFORESAID LANDS IN QUESTION AS ON THE RESPECTIVE VALUATION DATE AFTER OBTAINING VALUATION REPORT FROM THE DISTRICT VALUATION OFFICER (DVO) OR BASED ON THE VALUATION REPORT FILED BY THE ASSESSEE AND CORRECTLY DETERMINE THE NET WEALTH IN THE HANDS OF THE ASSESSEE. THE ASSESSING OFFIC ER IS ALSO DIRECTED TO ALLOW THE DEDUCTION OF DEBTS RAISED AS ON THE DATE OF ACQUISITION OF THE SAID LANDS FOR WHICH, THE ASSESSEE IS DIRECTED TO FILE THE NECESSARY PROOF. THUS, THE W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 12 GROUNDS OF THE APPEAL S RAISED BY THE ASSESSEE IN CROSS - OBJECTIONS EXCEPT GROUND NO.1 ARE ALLOWED. RUDRAKSHA BUILDERS PVT. LTD. 2 2 . THE APPEALS RELATING TO RUDRAKSHA BUILDERS PVT. LTD FOR ASSESSMENT YEARS 2008 - 09 TO 2010 - 11 AND 2013 - 14 FILED BY THE REVENUE ARE OF LOW TAX EFFECT AS PER THE REVISED MONETARY LIMITS PRESCRIBED B Y THE CBDT VIDE CIRCULAR NO.17/2019 DATED 08.08.2019 AND LETTER DT.20.08.2019. THE YEAR - WISE DETAILS ARE AS UNDER : ASST.YEAR ASSESSED WEALTH IN RS. TAX DEDUCTED IN RS. 2008 - 09 19 , 98,27,210/ - 19,98,272/ - 2009 - 10 19 , 83,27,210/ - 19,83,272/ - 2010 - 11 35 , 9 1,77,885/ - 35,91,779/ - 2013 - 14 26 , 95,54,600/ - 26,95,546/ - 2 3 . THE LEARNED AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FAIRLY POINTED THAT THE APPEALS OF THE REVENUE IN THIS REGARD NEED TO BE DISMISSED AND THE C.OS FILED BY THE ASSESSEE WOULD BECOME ACADE MIC. 2 4 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. IN LINE WITH OUR DECISION IN PARAS ABOVE IN THE CASE OF RAJENDRA M. DEVELOPERS AND BUILDERS PVT. LTD., (SUPRA) AND CASE OF THE REVISED MONETARY LIMITS OF FILING THE APPEALS BEFORE THE TRIBUNAL, THE PRESENT APPEALS FILED BY THE REVENUE ARE NOT MAINTAINABLE AS THE TAX EFFECT INVOLVED IS LESS THAN THE MONETARY LIMIT PRESCRIBED BY THE CBDT. THUS, THE APPEALS IN WTA NOS.7 TO 9 AND 12/PUN/2017 AND C.O.NOS.48 TO 50 AND 53/PUN/2017 ARE DISMIS SED. W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 13 2 5 . NOW COMING TO APPEALS WHERE TAX EFFECT IS HIGHER THAN THE MONETARY LIMITS FIXED. THE ISSUE RAISED IN ASSESSMENT YEARS 2011 - 12 AND 2012 - 13 IS WITH REGARD TO THE VALUE OF THE LAND AS ON THE DATE OF VALUATION AND WHETHER THE SAME IS INCLUDABLE AS NET WEALTH IN THE HANDS OF THE ASSESSEE IN THE ABSENCE OF PERMISSION RECEIVED FOR CONSTRUCTION FROM THE COMPETENT AUTHORITY OR ANY CONSTRUCTION BEING CARRIED OUT, AS ON THE VALUATION DATE. WE HAVE ALREADY DECIDED SIMILAR ISSUE IN THE CASE OF RAJENDRA M. DEVELOPERS AND BUILDERS PVT. LTD., (SUPRA) IN THE PARAS ABOVE RELEVANT TO ASSESSMENT YEAR 2014 - 15 IN WTA NO.35/PUN/2017 AND C.O.NO.76/PUN/2017. FOLLOWING THE SAME PARITY OF REASONING, WE DIRECT THE ASSESSING OFFICER TO INCLUDE THE VALUE OF THE AF ORESAID LANDS IN THE HANDS OF THE ASSESSEE IN THE RESPECTIVE YEARS. HOWEVER, FOR THE PURPOSE OF DETERMINING THE VALUE AS ON THE VALUATION DATE, THE ASSESSEE SHALL FILE THE VALUATION REPORT FROM THE REGISTERED VALUER OR THE ASSESSING OFFICER MAY OBTAIN THE NECESSARY VALUATION REPORT FROM THE DVO IN THIS REGARD AND COMPUTE THE NET WEALTH AND ASSESSING OFFICER IS ALSO DIRECT ED TO ALLOW THE VALUE OF DEBTS AS ON THE DATES OF PURCHASE OF PLOT IN THE HANDS OF THE ASSESSEE , IF STILL OUTSTANDING. PARIWAR MARKE TING PVT. LTD. 2 6 . NOW WE TAKE UP THE APPEALS RELATING TO PARIWAR MARKETING PVT. LTD., FILED BY THE ASSESSEE. 2 6 .1. IN ALL THESE APPEALS WHICH ARE FILED BY THE ASSESSEE, THE ISSUE RAISED IS AGAINST THE ORDER OF COMMISSIONER OF WEALTH - TAX (APPEALS) IN HO LDING THAT THE FAIR MARKET VALUE (FMV) OF THE LAND OWNED BY THE ASSESSEE , AS ON THE DATE OF VALUATION , WAS TO BE INCLUDED IN THE HANDS OF THE ASSESSEE. THE ASSESSEE IS ALSO AGGRIEVED BY THE ORDER OF C WT(A) IN NOT ALLOWING THE DEDUCTION OF DEBTS W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 14 ACCRUED. THE SAID ISSUE ALSO STANDS SQUARELY COVERED BY OUR DECISION IN WTA NO.35/PUN/2017 WHICH WAS AN APPEAL FILED BY THE REVENUE AS THE CWT(A) IN THOSE CASES HAD ALLOWED THE CLAIM. THE ASSESSEE IN C.O.NO.76/PUN/2017 HAD RAISED THE ISSUE OF VALUE OF THE LA NDS TO BE ADOPTED AND THE COSTS OF THE DEBTS TO BE ALLOWED WHICH WE HAVE ADJUDICATED AS ABOVE. IN LINE WITH OUR DIRECTIONS ABOVE IN THE CASE OF RAJENDRA M. DEVELOPERS AND BUILDERS PVT. LTD., (SUPRA), THE ASSESSING OFFICER SHALL COMPUTE THE VALUE OF THE SAID LAND AS ON THE DATE OF VALUATION OF THE LANDS IN LINE WITH OUR DIRECTIONS IN PARAS ABOVE AND ALSO ALLOW THE CLAIM OF THE DEBTS AGAINST THE VALUE OF THE PROPERTY AFTER DUE VERIFICATION AND IF STILL OUTSTANDING. THUS, ALL THESE APPEALS FILED BY THE A SSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 2 7 . ONE COMMON GROUND OF APPEAL WHICH IS RAISED IN ALL THE C.OS BY THE ASSESSEE AND GROUND OF APPEAL NO.1 IS RAISED IN THE APPEALS FILED BY THE ASSESSEE IN CASE OF PARIWAR MARKETING PVT. LTD, IS AGAINST THE IS SUE OF NOTICE U/S 17(1) OF THE ACT AND THE CONSEQUENT ASSESSMENT PROCEEDING INITIATED, THE ASSESSEE CLAIMS THAT THE SAID ASSESSMENT BE HELD TO BE NULL AND VOID. 28 . FACTS RELATING TO THE ISSUE RAISED ARE THAT , SEARCH AND SEIZURE U/S 132 OF THE ACT COND UCTED IN THAKKE R GROUP OF CASES ON 15.01.2015. T HE RESIDENTIAL PREMISES OF THE DIRECTORS AND SIMULTANEOUSLY OFFICE PREMISES OF THE COMPANY WERE ALSO COVERED UNDER SEARCH ACTION. DURING THE COURSE OF SEARCH, IT WAS REVEALED THAT ASSESSEE GROUP HAD LOT OF COMPANIES IN WHICH THEY WERE HAVING LANDS OR STOCK - IN - TRADE OR BOTH. BUT ALL THESE COMPANIES HAD NOT FILED THEIR WEALTH TAX RETURNS IN ANY ASSESSMENT YEAR. THE ASSESSING OFFICER THUS ISSUED A NOTICE UNDER SECTION 17 OF THE WEALTH - TAX ACT. IN REPLY TO THE SAID NOTICE, ASSESSEE FILED THE RETURN OF WEALTH DECLARING NIL WEALTH. W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 15 29 . THE QUESTION WHICH ARISES IS REGARDING VALUATION OF LAND WHERE THE ASSESSEE GROUP POSSESSES MORE THAN 1110 ACRES OF PLOTS IN NASHIK AND IN ITS VICINITY , WHICH LAND BANK WAS ACCUMULATED OVER A PERIOD OF TIME AND S INCE THERE WERE CERTAIN EMBARGOS IN HOLDING THE LAND IN THE NAME OF INDIVIDUALS, THE ASSESSEE INCORPORATED DIFFERENT COMPANIES AND THE LANDS WERE SHOWN IN THE HANDS OF THE SAID COMPANIES. THE ASSESSING OFFICER N OTED THAT THE SAID COMPANIES C OULD NOT HOLD AGRICULTURAL LANDS AS THERE WAS EM BARGO IN MAHARASHTRA LAND REVENUE CODE. BEFORE THE REVENUE AUTHORITIES, THE ASSESSEE TOOK THE STAND THAT THE LANDS WERE FOR INDUSTRIAL AND COMMERCIAL PURPOSES AND NOT FOR AGRICULTURAL PURPOSES, HENCE, COULD BE HELD BY THE COMPANIES. THE ASSESSING OFFIC ER IN SUCH FACTS AND CIRCUMSTANCES, HAD CORRECTLY RECORDED THE REASONS FOR ESCAPEMENT OF WEALTH AND THE CONSEQUENT LY ISSUE D NOTICE U/S 17 OF THE ACT. IN SUCH FACTS AND CIRCUMSTANCES, WHERE THE ASSESSEE HAD FAILED TO FURNISH ANY RETURN OF WEALTH, THE REAS ONS RECORDED FOR RE - OPENING WERE CORRECTLY RECORDED , THE ASSESSMENT AGAINST ESCAPEMENT OF WEALTH WAS VALID . THE CONSEQUENT ISSUE OF NOTICE U/S 17 OF THE ACT AND INITIATION OF PROCEEDINGS U/S 17 OF THE ACT ARE UPHELD. WE HAVE IN THE PARAS ABOVE HELD THAT THE LANDS OWNED BY THE ASSESSEE ARE TAXABLE WEALTH AND TO BE INCLUDED IN THE HANDS OF THE ASSESSEE , THEN THE CLAIM OF THE ASSESSEE THAT THE AFORESAID AGRICULTURAL LANDS WERE EXEMPT FROM WEALTH TAX DO NOT STAND. IN ANY CASE, NO SUCH PLEA WAS RAISED BEFOR E US. TIME AND AGAIN THE ASSESSEE PLEADED THAT THE LANDS IN QUESTION WERE NOT URBAN - LAND . WE HAVE ALREADY DECIDED THE ISSUE THAT THE VALU E OF THE SAID LANDS W ERE INCLUDABLE IN THE HANDS OF THE ASSESSEE AS ON THE VALUATION DATE. IN SUCH CIRCUMSTANCES, WE UPHOLD THE INITIATION OF ASSESSMENT PROCEEDINGS IN THE HANDS OF THE ASSESSEE AND DISMISS THE GROUNDS RAISED BY THE ASSESSEE. THE GROUND NO.2 IN C.O.NOS.74 TO 76/PUN/2017 AND GROUND NO.6 IN C.O.NOS.1 0 AND 11/PUN/201 9 HAVE NOT W TA NO S . 33 TO 35 /P U N/20 1 7 & ORS CO NOS.74 TO 76/PUN/2017 & ORS 16 BEEN PRESSED BY THE ASSESS EE. HENCE, THE SAME ARE DISMISSED AS NOT PRESSED. 3 0 . TO SUM UP, APPEALS OF REVENUE IN WTA NOS.33 & 34/PUN/2017 AND WTA NOS.8 & 9/PUN/2019 ARE DISMISSED. THE CO NOS.74 & 75/PUN/2017 AND CO NO.10 & 11 /PUN/2019 ARE ALSO DISMISSED. THE APPEALS OF REVENUE IN WTA NO.35/PUN/2017 IS ALLOWED. THE CO NO.76/PUN/2017 IS PARTLY ALLOWED. THE APPEALS IN WTA NOS.7 TO 9/PUN/2017 AND 12/PUN/2017 ARE DISMISSED. THE CO NOS.48 TO 50/PUN/2017 AND CO NO.53/PUN/2017 ARE DISMISSED. THE APPEALS IN WTA NOS.10 & 11/PUN/2017 A RE ALLOWED AND CO NOS.51 & 52/PUN/2017 ARE PARTLY ALLOWED. THE APPEALS IN WTA NOS.62 TO 66/PUN/2017 ARE PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 11 TH DAY OF SEPTEMBER, 201 9 . SD/ - SD/ - ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 11 TH SEPTEMBER, 201 9 . YAMINI / GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. THE CWT - 12, PUNE. 4. THE PRL.CWT, CENTRAL, NAGPUR. 5. , , / DR B , ITAT, PUNE ; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE