M/s. Cheviot Company Limited, Kolkata V. DCIT, Circle - 1(1), Kolkata, Kolkata

CO 91/KOL/2017

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3896 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 17 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M TIWARI
• Assessee Lawyers: G HANGSHSING
• Keywords: Reason to believe

Judgement Text

, D , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH D KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER W.T .A NO. 07 - 08 / KOL / 20 17 AND COS NO. 90-91/KOL/2017 (A/O ITA NO.07-08/KOL/2017 ASSESSMENT YEARS :2008-09 & 2009-10 DCIT, CIRCLE-1(1), AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE, ROOM NO. 20, 7 TH FLOOR, KOLKATA-69 V/S . M/S CHEVIOT COMPANY LTD., 9 TH FLOOR, MAGMA HOUSE, 24, PARK STREET, KOLKATA-16 [ PAN NO. AABCC 2380 H ] /APPELLANT .. / RESPONDENT/ /CO-OBJECTOR /BY ASSESSEE SHRI G. HANGSHSING, CIT-DR /BY REVENUE SHRI M. TIWARI, FCA /DATE OF HEARING 06-06-2018 /DATE OF PRONOUNCEMENT 08-06-2018 / O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THESE TWO REVENUES APPEALS FOR ASSESSMENT YEARS 20 08-09 AND 2009- 10 ALONG WITH ASSESSEES CROSS OBJECTIONS THERETO A RISE AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-12, KOLKATAS SEPARATE ORDERS; DATED 14.03.2017 AND 22.03.2017; RESPECTIVELY, IN P ROCEEDINGS U/S 23 OF THE WEALTH TAX ACT, 1957; IN SHORT THE ACT. 2. A PERUSAL OF THE REVENUES PLEADINGS SUGGESTS TH AT IT CHALLENGES THE CIT(A)S FINDINGS HOLDING THE ASSESSEES ASSETS (FR EEHOLD LAND SITUATED AT BUDGE BUDGE AS WELL AS ITS REGISTERED OFFICE NAMELY MAGMA HOUSE, 24 PARK WTA NO.07-08/KOL/2017 & CO 90-91/KOL/17 A.YS. 08-09 & 09-10 DCIT CIR.1(1) KOL. VS. M/S CHEVOIT CO. LTD. PAGE 2 STREET, 9 TH FLOOR KOLKATA-16) TO BE NOT THE CHARGING WEALTH FO R THE PURPOSE OF THE IMPUGNED WEALTH TAX ASSESSMENTS. THE ASSESSEES CROSS OBJECTIONS ON THE OTHER HAND ASSAIL CORRECTNESS OF THE IMPUGNED R E-OPENING TAKEN RECOURSE BY THE ASSESSING OFFICER AS UPHELD IN THE LOWER APP ELLATE PROCEEDINGS. 3. IT IS EVIDENT THAT THE CIT(A)S ORDER FOR AY 200 8-09 FOLLOWED IN AY 2009- 10 READS AS UNDER:- 5.1 I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE WRITTEN SUBMISSIONS FILED BY THE A/R OF THE APPELLANT. I FIND THAT THE VALUE OF FREEHOLD LAND OF RS.62,57,09,250/- INCLUDES TWO FREEHOLD LANDS ON WH ICH COMPANYS BUILDING, FACTORY SHED AND MANUFACTURING UNITS ARE CONSTRUCTE D. DETAILS OF SUCH FREEHOLD LAND ALONG WITH BUILDING, FACTORY SHED AND MANUFACTURING UNIT ARE AS UNDER:- (1) FREEHOLD LAND SITUATED AT 24, PARK STREET, MAGM A HOUSE, 9 TH FLOOR, KOLKATA-700 016 (2) 19, MEHTA ROAD, BARE KALINAGAR, BUDGE BUDGE, 24 PARGANAS (SOUTH). I FIND THAT THE APPELLANTS REGISTERED OFFICE IS SI TUATED AT MAGMA HOUSE, 24 PARK STREET, 9 TH FLOOR, KOLKATA-700 016 AND IS BEING USED FOR BUSIN ESS PURPOSES ONLY SINCE LONG TIME PAST AND THE BOOK VAL UE OF THIS LAND AS ON 31/03/1986 WAS RS.2,14,148/-. THIS WAS REVALUED FRO M TIME TO TIME AND ITS REVALUED FIGURE AS ON 31/03/1986 WAS RS.625.20 LAKH S. APART FROM THIS THE PROPERTY OF MAGMA HOUSE IS A COMMERCIAL ESTABLISHME NT AND THE APPELLANT IS PAYING CORPORATION TAX AT COMMERCIAL RATES ONLY. TH US THIS PROPERTY CANNOT FORM PART OF CHARGEABLE WEALTH FOR THE PURPOSE OF W T ACT. THE 2 ND FREEHOLD LAND IS SITUATED AT BUDGE BUDGE. THE APPE LLANTS JUTE MILL IS SITUATED AT THIS LAND. ITS VALUE AS INS BOOKS WAS R S.96,789/- AN 30/11/1940. THIS LAND IS ALSO USED BY THE APPELLANT FOR ITS BUS INESS PURPOSES. THIS LAND WAS REVALUED TIME TO TIME AND THE REVALUED FIGURE O F THIS LAND AS ON 31/03/2008 STOOD AT RS.5,631.89 LAKHS. I FIND THAT THE APPELLANT IS PAYING MUNICIPAL TAX AT COMMERCIAL RATES ONLY. THUS THIS L AND ALSO CANNOT FORM PART OF CHARGEABLE WEALTH FOR THE PURPOSE OF WEALTH TAX. TH E AO IS DIRECTED TO DELETE THE ADDITION OF RS.62,57,09,250/-. THUS THE GROUND OF APPEAL IS ALLOWED. 4. LEARNED DEPARTMENTAL REPRESENTATIVE TAKES PAINS TO ARGUE AT THE REVENUES BEHEST THAT CIT(A) HAS ERRED IN LAW AS WE LL AS ON FACTS IN HOLDING THAT BOTH ABOVE STATED PROPERTIES ARE NOT COVERED A S CHARGEABLE WEALTH BEING IN THE NATURE OF COMMERCIAL ESTABLISHMENTS USED FOR BUSINESS PURPOSES ON PRODUCTIVE ASSETS. WE SEE NO MERIT IN REVENUES INS TANT SOLE ARGUMENT. A CO- ORDINATE BENCH IN WTA 43/KOL/2014 M/S NAVIN VINIJYA PVT. LTD. VS. ACWT WTA NO.07-08/KOL/2017 & CO 90-91/KOL/17 A.YS. 08-09 & 09-10 DCIT CIR.1(1) KOL. VS. M/S CHEVOIT CO. LTD. PAGE 3 DECIDED ON 21.09.2016 ADJUDICATES THE VERY QUESTION IN ASSESSEES FAVOUR AS FOLLOWS:- 3. THE COMMON ISSUE TO BE DECIDED IN THESE APPEALS IS, ASSUMPTION OF JURISDICTION OF THE LD. ASSESSING OFFICER BY ISSUANCE OF NOTICE UND ER SECTION 17 OF THE ACT AND WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE HOUSE PROPERTY WHICH HAS BEEN LET OUT TO A TENANT WOULD BE OUTSIDE THE AMBIT OF WEALTH TAX UNDER SECTION 2(EA)(I)(V) OF THE WEALTH TAX ACT, 1957.THE ASSESSE E RAISED THE ISSUE THAT THE HOUSE PROPERTY UNDER CONSIDERATION IS NOT AN ASSET FOR TH E PURPOSE OF WEALTH TAX AND THE REASONS RECORDED BY THE ASSESSING OFFICER ARE NOT V ALID. 4. THE APPEAL IN WTA NO.43/KOL/2014 PERTAINING TO A SSESSMENT YEAR 2006-07, IS TAKEN AS THE LEAD CASE. THE LD AO NOTICED THAT THE ASSESSEE COMPANY RECEIVED RENT OF RS.15 LAKHS DURING THE ASSESSMENT YEAR 2006-07 F ROM A HOUSE PROPERTY. THE RENT SO RECEIVED WAS REFLECTED IN THE RETURN OF INCOME A S INCOME FROM HOUSE PROPERTY. AS PER THE PROVISION OF SECTION 2(EA)(II) OF THE WEALT H TAX ACT, 1957. ASSET MEANS ANY BUILDING OR LAND APPURTENANT THERETO (HEREINAFTER R EFERRED TO AS HOUSE ), WHETHER USED FOR RESIDENTIAL OR COMMERCIAL PURPOSES OR FOR THE GUEST HOUSE PURPOSE. THE PROPERTY FROM WHICH RENT WAS RECEIVED WAS NOT USED BY THE ASSESSEE FOR ITS BUSINESS PURPOSE. THEREFORE, THE VALUE OF THE PROPERTY WAS C HARGEABLE TO WEALTH TAX, AS THE PROPERTY WAS AN ASSET WITHIN THE MEANING OF SECTION 2(EA)(II) OF THE WEALTH-TAX ACT, 1957. THE AO VALUED THE SAID PROPERTY AS PER PART-B OF SCHEDULE-III OF THE WEALTH TAX ACT. THUS, IT WAS CLEAR THAT THE ASSESSEE WAS L IABLE TO PAY WEALTH TAX IN RESPECT OF NET WEALTH FOR THE ASSESSMENT YEAR 2006-07, BUT NO RETURN OF WEALTH WAS FILED. THEREFORE, REASONS WERE RECORDED AND NOTICE UNDER S ECTION 17 OF THE ACT WAS ISSUED ON 31ST MARCH, 2010. IN RESPONSE TO NOTICE UNDER SE CTION 17 OF THE WEALTH TAX ACT, WTA NO.43 /KOL/2014 M/S. NAVIN VANIJYA PVT. LTD. 3 1957, RETURN OF WEALTH WAS FILED ON 07.05.2010, DECLARING NET WEALTH OF RS. NIL. W HILE MAKING THE ADDITION, THE AO ASSESSED THE NET WEALTH AT RS.59,37,500/- UNDER SEC TION 17/16(III) OF THE ACT. AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS), CENTRAL-I, KOLKATA WHO HAS ALSO CONFIRME D THE ORDER OF THE AO, OBSERVING THE FOLLOWING: 4. THE LD AR APPEARED FOR THE ASSESSEE AND CHALLENG ED THE IMPUGNED ORDER BY MAKING ORAL AND WRITTEN SUBMISSIONS. THE LD AR C ONTESTED THE ACTION OF THE AO ON THE GROUND THAT THE PROPERTY UNDER CONSID ERATION WAS A COMMERCIAL COMPLEX AND CONSEQUENTLY THE SAME WAS EXEMPT IN VIE W OF SECTION 2(EA)(I)(5). I HAVE PERUSED THE ASSESSMENT ORDER AN D CONSIDERED THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE. I FIND THAT THE ASSESSEE COULD BRING NO POSITIVE MATERIAL ON RECORD TO SUBSTANTIAT E ITS CLAIM THAT THE PROPERTY UNDER CONSIDERATION WAS A COMMERCIAL COMPLEX. THE D OCUMENTS PRODUCED BY THE ASSESSEE CAN AT BEST SUGGEST THAT THE PROPERTY WAS BEING UTILISED FOR COMMERCIAL PURPOSES. BUT THEN, I FIND MERIT IN THE CONTENTION OF THE AO THAT A PROPERTY EVEN IF IT WAS BEING UTILISED FOR COMMERCI AL PURPOSES IS INCLUDIBLE IN THE NET WEALTH IN VIEW OF SECTION 2(EA)(I). UNDER T HE CIRCUMSTANCES, I AM UNABLE TO UPHOLD THE CONTENTION OF THE ASSESSEE THA T THE PROPERTY AT BANGALORE WAS NOT ASSESSABLE IN ITS NET WEALTH. ALS O, I DO NOT FIND MERIT IN THE SUBMISSION OF THE ASSESSEE THAT THE INITIATION OF P ROCEEDINGS U/S 17 WAS NOT JUSTIFIED. GROUND NO 1 AND 2 ARE DISMISSED. IN GROU ND NO 3, THE ASSESSEE HAS CONTENDED THAT THE AO WAS NOT JUSTIFIED IN ADOPTING THE RENTAL METHOD FOR DETERMINING THE VALUE OF THE PROPERTY UNDER CONSIDE RATION. HOWEVER, NO ARGUMENTS WERE MADE IN SUPPORT OF THIS GROUND DURIN G THE COURSE OF THE APPELLATE PROCEEDINGS. GROUND NO 3 IS DISMISSED. TH E ORDER OF THE AO IS UPHELD. GROUND NO 4 IS GENERAL IN NATURE. WTA NO.07-08/KOL/2017 & CO 90-91/KOL/17 A.YS. 08-09 & 09-10 DCIT CIR.1(1) KOL. VS. M/S CHEVOIT CO. LTD. PAGE 4 4.1 NOT BEING SATISFIED WITH THE ORDER OF THE LD. C IT(A), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US ON THE FOLLOWING GROUNDS: 1. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE LD A.O. IN INITIATING PROCEEDINGS U/S 17 AND ASSUMING JURISDICTION U/S 17. WTA NO.43 /KOL/2014 M /S. NAVIN VANIJYA PVT. LTD. 4 2. THAT IN THE FACTS AND CIRCUMSTANCES OF TH E CASE, THE LD. C.I.T. (A) ERRED IN CONFIRMING THE ACTION OF THE LD. ASSESSING OFFICER IN TREATING THE COMMERCIAL COMPLEX AS AN ASSET FOR THE PURPOSE OF T HE WEALTH TAX. 4.2 THE LD AR FOR THE ASSESSEE HAS SUBMITTED THAT T HE ASSESSING OFFICER REOPENED THE ASSESSMENT UNDER SECTION 17 OF THE WEALTH TAX A CT, WITHOUT AND BASE, PRESUMING THAT HOUSE PROPERTY HAS ESCAPED FROM THE WEALTH TAX. THE LD. AO TREATED THE LET OUT HOUSE PROPERTY AS AN ASSET UNDER SECTIO N 2(EA)(II) OF THE WEALTH TAX ACT, 1957, WHEREAS IT IS A PRODUCTIVE ASSET AND DOES NOT FALL IN THE AMBIT OF WEALTH TAX. THE LD. AR FOR THE ASSESSEE SUBMITTED THAT THE MEMO RANDUM EXPLAINING THE PROVISION IN THE FINANCE NO.2 BILL, 1998 UNDER THE HEAD INCE NTIVES PROPOSED UNDER THE WEALTH TAX ACT, IT IS CLARIFIED THAT WEALTH TAX IS NOT LE VIED ON PRODUCTIVE ASSETS. IN VIEW OF THIS LOGIC, IT IS VERY MUCH CLEAR THAT WEALTH TAX W OULD ALSO NOT BE LEVIED ON SUCH HOUSE PROPERTY FROM WHICH THE ASSESSEE IS GETTING RENT AN D THE SAME HAS BEEN LET OUT BY THE ASSESSEE FOR A PERIOD OF 300 DAYS OR MORE. WITH REGARD TO 1ST GROUND RAISED BY THE ASSESSEE AND ASSUMPTION OF JURISDICTION, WE FIN D FROM THE RECORDS THAT THE LD. AO HAD NOT RIGHTLY INVOKED THE REOPENING PROCEEDINGS A S HIS REASON TO BELIEVE THAT THE WEALTH TAX HAS ESCAPED ASSESSMENT FROM HOUSE PROPER TY BELONGING TO THE ASSESSEE IS NOT CORRECT. HENCE, GROUND NO.1 RAISED BY THE AS SESSEE IS ALLOWED. 4.3 IN THE RESULT, THE GROUND NO.1 RAISED BY THE AS SESSEE IS ALLOWED. 5.GROUND NO. 2: COMMERCIAL COMPLEX- WHETHER IT IS A N ASSET? LD. AR SUBMITTED THAT IT IS ABUNDANTLY CLEAR THAT THOSE RESIDENTIAL PROPE RTIES THAT HAVE BEEN LET OUT FOR A PERIOD OF 300 DAYS IN A YEAR, AND IT IS ALSO PROPOS ED TO EXEMPT COMMERCIAL ESTABLISHMENTS AND COMPLEXES FROM THE AMBIT OF WEAL TH-TAX ACT. IT IS, THUS, CLEAR THAT THE LEGISLATURE HAS ADOPTED A LOGIC THAT WEALT H-TAX IS NOT LEVIED ON PRODUCTIVE ASSETS, AND IN VIEW OF THAT LOGIC, IT WAS PROPOSED THAT WEALTH-TAX WOULD NOT BE LEVIED ON SUCH RESIDENTIAL PROPERTY THAT HAS BEEN LET OUT TO OTHERS. THE ASSESSEE HAS ALSO RELIED ON A JUDGMENT RENDERED BY THE HONBLE INCOME TAX APPELLATE TRIBUNAL A BENCH, KOLKATA VIDE WTA NOS.45&46/KOL/14 FOR THE AS SESSMENT YEARS 2006-07 AND 2007-08, RELEVANT PART OF SUCH JUDGMENT ARE REPRODU CED BELOW: 6.1. WE FIND THAT THE ISSUE IS COVERED BY THE COORD INATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF WTO VS FERROLITE PRODU CTS LTD REPORTED IN (2015) 55 TAXMANN.COM 285 (KOLKATA TRIBUNAL). THE FACTS BE FORE THIS TRIBUNAL IN THE SAID CASE IS THAT THE ASSESSEE RENTED OUT PREMISES TO 'D' LTD AND RENTAL INCOME WAS ASSESSED UNDER THE HEAD 'INCOME FROM-HOU SE PROPERTY'. THE ASSESSEE CLAIMED THAT THE SAID PROPERTY WAS IN THE NATURE OF COMMERCIAL ESTABLISHMENT AS PER SECTION 2(EA)(I)(5) OF THE ACT AND THUS IT COULD NOT BE INCLUDED IN THE NET WEALTH OF ASSESSEE. THE AO TREA TED THE FACTORY PREMISES BEING THE LAND AND BUILDING AS TAXABLE WEALTH WITHI N THE MEANING OF SECTION 2(EA). THE CIT(A) FINDING THAT THE FACTORY PREMISES WAS BEING USED FOR PRODUCTIVE PURPOSES AND WAS IN THE NATURE OF COMMER CIAL ESTABLISHMENT, ALLOWED ASSESSEE'S CLAIM. ON REVENUE'S APPEAL TO TR IBUNAL, IT WAS HELD AS FOLLOWS:- '7. THE FACTS EMERGES ARE THAT TOTAL AREA OF LAND C ONSISTS OF 20164 SFT OUT OF WHICH AREA IS 10771 SFT NAMELY, THE FACTORY BUILDING, COURTYARD, ELECTRICAL SUBSTATION, LABOUR QUARTERS, OFFICE AND GODOWN ETC. THE WTA NO.07-08/KOL/2017 & CO 90-91/KOL/17 A.YS. 08-09 & 09-10 DCIT CIR.1(1) KOL. VS. M/S CHEVOIT CO. LTD. PAGE 5 ASSESSEE RENTED OUT THIS PREMISES TO M.S DALMIA'& C O LTD FOR A RENT OF RS..12 LAKH PER ANNUM AND THIS RENT WAS ASSESSED UNDER THE HEAD 'INCOME FROM HOUSE PROPERTY. FROM THE VERY READING OF SUB-CLAUSE (5) IT IS CLEAR THAT THIS COVERS ALL THOSE PROPERTIES W HICH IN THE NATURE OF COMMERCIAL ESTABLISHMENT OR COMPLEX MEANING THEREBY THAT THE PROPERTY MUST BE IN THE NATURE OF COMMERCIAL ESTABL ISHMENT OR COMPLEX WHICH IN TURN INDICATES THAT THE PROPERTY M UST ALSO BE ACTUALLY USED FOR THE PURPOSE OF ANY BUSINESS OR TRADE CARRI ED ON IN THOSE COMMERCIAL ESTABLISHMENTS OR COMPLEXES. WE ARE OF T HE VIEW THAT THIS SUB-CLAUSE (5) ' COMPLEXES OR ESTABLISHMENTS ' ARE QUALIFIED WITH AN ADJECTIVE 'COMMERCIAL'. ESTABLISHMENT OR COMPLEX, T HEREFORE, MUST BE OF A COMMERCIAL IN NATURE. THE WORD ' COMMERCIAL ' MEANS SOMETHING WHICH IS USED IN OR RELATED TO, A BUSINESS OR A TRA DE. COMMERCIAL MEANS RELATES TO OR ENGAGED IN OR USED FOR COMMERCE OR TRADE. THE WORD ' ESTABLISHMENT ' MEANS AN ORGANIZATION, BUILDING, CONSTRUCTION, SHOP, STORE, CONCERN OR CORPORATION. THUS; COMMERCI AL ESTABLISHMENT MEANS SOME KIND OF PLACE OR BUILDING OR SHOP OR STO RE WHERE BUSINESS OR TRADE IS CARRIED ON. THE WORD ' COMPLEX ' MEANS COMPOSITE, COMPOUNDED, MULTIPLE, MANIFOLD, MULTI-COMPLEX OR SO METHING, COMPOSED OF OR MADE OF MANY INTERRELATED PARTS, AS FOR EXAMPLE, A MULTI-PURPOSE BUILDING. THUS, THE WORD ' COMMERCIAL COMPLEX' . MEANS THE COMMERCIAL MULTI-PURPOSE BUILDING COMPOSED AND MADE OF INTERRELATING PARTS IN CONTRAST TO A SINGLE COMMERC IAL ESTABLISHMENT. IN THE CASE OF COMMERCIAL ESTABLISHMENT, IT IS NOT NEC ESSARY THAT IT SHOULD BE COMPOSED OF OR MADE OF INTERRELATED PARTS . THE LEGISLATURE HAS EXCLUDED BOTH COMMERCIAL ESTABLISHMENT AS WELL AS COMMERCIAL COMPLEXES FROM THE DEFINITION OF ' ASSET ' FOR THE PURPOSE OF CHARGEABILITY TO TAX UNDER THE ACT. FURTHER, THE ME MORANDUM EXPLAINING THE PROVISIONS IN THE FINANCE NO. 2 BILL , 1998, UNDER THE HEAD ' INCENTIVES PROPOSED UNDER THE WEALTH-TAX ACT ', IT IS CLARIFIED THAT WEALTH-TAX IS NOT LEVIED ON PRODUCTIVE ASSETS. IN VIEW OF THIS LOGIC, IT IS PROPOSED THAT WEALTH TAX WOULD ALSO NOT BE LE VIED ON SUCH RESIDENTIAL PROPERTIES THAT HAVE BEEN LET OUT FOR A PERIOD OF THREE HUNDRED DAYS IN A YEAR, AND, IT IS ALSO PROPOSED TO EXEMPT COMMERCIAL ESTABLISHMENTS AND COMPLEXES FROM THE AMBIT OF WEAL TH-TAX ACT. IT IS, THUS, CLEAR THAT THE LEGISLATURE HAS ADOPTED A LOGI C THAT WEALTH-TAX IS NOT LEVIED ON PRODUCTIVE ASSETS, AND IN VIEW OF THA T, IT WAS PROPOSED THAT WEALTH- TAX WOULD NOT BE LEVIED ON PROPERTY TH AT HAS BEEN LET OUT FOR A PERIOD OF MINIMUM 300 DAYS IN A YEAR AND TO E XEMPT COMMERCIAL ESTABLISHMENTS AND COMPLEXES FROM THE AMBIT OF WEAL TH TAX. THEREFORE, WHILE CONSTRUING THE MEANING TO SUB-CLAU SES (4) AND (5) INSERTED BY THE FINANCE NO. 2 ACT, 1998 WITH EFFECT FROM 1.4.89, THE INTENTION OF LEGISLATURE IS THAT WEALTH-TAX IS NOT TO BE LEVIED ON PRODUCTIVE ASSETS AND THAT IS TO BE KEPT IN MIND. I N VIEW OF THE FACTS OF THIS CASE AND DISCUSSION IN VIEW OF INSERTION OF SU B-CLAUSE (5) AS INSERTED BY THE FINANCE NO. 2 ACT, 1998 WITH EFFECT FROM 1.4.89 WEALTH- TAX IS NOT TO BE LEVIED ON PRODUCTIVE ASSETS. HENCE , IN VIEW OF REASONING GIVEN ABOVE, WE CONFIRM THE ORDER OF CIT( A) AND DISMISS BOTH APPEALS OF REVENUE. 'THE FACTS OF THE INSTANT CASE AND THE DECISION RENDERED BY THIS TRIBUNAL (SUPRA) ARE IDEN TICAL. WE HOLD THAT THE SUBJECT MENTIONED PROPERTY IS A COMMERCIAL COMP LEX AND IS A PRODUCTIVE ASSET DERIVING RENTAL INCOME OF RS. 15,0 0,000/- PER ANNUM. IT IS WELL SETTLED FROM THE MEMORANDUM EXPLAINING T HE PROVISIONS IN THE FINANCE NO. 2, 1998 UNDER THE HEAD ' INCENTIVES PROPOSED UNDER THE WTA NO.07-08/KOL/2017 & CO 90-91/KOL/17 A.YS. 08-09 & 09-10 DCIT CIR.1(1) KOL. VS. M/S CHEVOIT CO. LTD. PAGE 6 WEALTH TAX ACT ' THAT WEALTH TAX IS NOT TO BE LEVIED ON PRODUCTIVE ASSETS. 5.1. HENCE RESPECTFULLY FOLLOWING THE SAID DECISION , WE HOLD THAT THE SUBJECT MENTIONED PROPERTY SHALL BE EXEMPT U/S 2(EA)(V) OF THE ACT AND THEREFORE OUTSIDE THE AMBIT OF TAXABLE WEALTH. ACCORDINGLY, THE GROUND NO .2 RAISED BY THE ASSESSEE IN THIS REGARD FOR BOTH THE ASSESSMENT YEARS ARE ALLOWED. 5. LEARNED DEPARTMENTAL REPRESENTATIVE IS VERY FAIR IN NOT POINTING OUT ANY EXCEPTION THEREIN. WE THEREFORE DECLINE REVENUES S OLE SUBSTANTIVE GROUND AS WELL AS ITS TWO APPEALS WTA 07 AND 08/KOL/2017. ASS ESSEES CROSS OBJECTIONS CHALLENGING VALIDITY OF RE-OPENING ARE R ENDERED INFRUCTUOUS. 6. THIS TWO REVENUES APPEALS WTA 7 AND 8/KOL/2017 ARE DISMISSED AND ASSESSEES CROSS OBJECTION CO NO.90 AND 91/KOL/2017 ARE DISMISSED AS RENDERED INFRUCTUOUS. ORDER PRONOUNCED IN THE OPEN COURT 08/ 06/2018 SD/- SD/- ( ) () ) (DR. A.L. SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) KOLKATA, *DKP, SR.P.S *- 08 / 06 /201 8 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-M/S CHEVIOT CO. LTD., 9 TH FL, MAGMA HOUSE, 24, PARK ST. KOLKATA-16 2. /REVENUE-DCIT, CIRCLE-1(1), AAYAKAR BHAWAN, P-7, CH OWRINGHEE SQUARE, ROOM NO. 20, 7 TH FLOOR, KOLKATA-69 3. 5 6 / CONCERNED CIT KOLKATA 4. 6- / CIT (A) KOLKATA 5. 9 ))5, 5, / DR, ITAT, KOLKATA 6. > / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO 5,