COMMISSIONER OF WEALTH-TAX vs. ASHOKRAJE GAEKWAD

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WTR/93/1995HC GujaratGJHC24022775199517 July 2006Author: HONOURABLE MR. JUSTICE M.R. SHAH,HONOURABLE MR. JUSTICE R.S.GARG3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court answered the referred question against the Revenue. The Court noted that in a previous case, Commissioner of Wealth-tax v. Ashok Raje Gaekwad (reported in 267 ITR 54), the High Court had already held in relation to occupancy that a Hindu Undivided Family (HUF) would be entitled to the benefits flowing from Section 7(4) of the Wealth-tax Act. The Court also observed that the previous matter involved the same Revenue and the same assessee. Therefore, following its own precedent, the High Court ruled that the assessee HUF is entitled to the benefit of Section 7(4) of the Act in respect of the property "Dhairya Prasad". The Wealth Tax Reference was disposed of in light of this decision.

What were the facts?

The Revenue (Commissioner of Wealth-tax) has referred a question of law to the High Court of Gujarat at Ahmedabad concerning the assessee, Ashokraje Gaekwad, a Hindu Undivided Family (HUF). The dispute pertains to the assessment year(s) not explicitly stated, but the core issue revolves around the HUF's claim for the benefit of Section 7(4) of the Wealth-tax Act in respect of a property known as "Dhairya Prasad". The Revenue's consistent contention was that the benefit of Section 7(4) is not available if the property is not self-occupied by the assessee. The High Court had previously dealt with a similar matter between the same parties.

What were the issues?

1. Whether, on the facts and in the circumstances of the case and in law, the Tribunal is right in holding that the assessee (HUF) is entitled to the benefit of Section 7(4) of the Wealth-tax Act in respect of the property known as “Dhairya Prasad”, despite its status being an HUF? Assessee's Contention: The judgment does not record any specific arguments made by the assessee before the High Court, other than implicitly relying on the previous High Court judgment. The assessee was claiming the benefit of Section 7(4) of the Wealth-tax Act. Revenue's Contention: The Revenue argued that if the property was not self-occupied, then the benefit of Section 7(4) of the Wealth-tax Act would not be available to the assessee.

Which sections of the Income-tax Act were involved?

Section 7(4)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

WTR/93/1995 1/3 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD WEALTH TAX REFERENCE No. 93 of 1995 For Approval and Signature: HONOURABLE MR.JUSTICE R.S.GARG HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= COMMISSIONER OF WEALTH-TAX - Applicant(s) Versus ASHOKRAJE GAEKWAD - Respondent(s) ========================================================= Appearance : MR MANISH R BHATT for Applicant(s) : 1, None for Respondent(s) : 1, ========================================================= CORAM : HONOURABLE MR.JUSTICE R.S.GARG and HONOURABLE MR.JUSTICE M.R. SHAH Date : 17/07/2006

ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE R.S.GARG)

WTR/93/1995 2/3 JUDGMENT

At the instance of the Revenue, following question has been referred by the Income-tax Appellate Tribunal to this Court for its answer. “Whether, on the facts and in the circumstances of the case and in law, the Tribunal is right in holding that the assessee (HUF) despite its status being an HUF, despite its status being in HUF, is entitled to the benefit of section 7[4] of the Act in respect of property known as “Dhairya Prasad”?”

The assessee, which is a Hindu Undivided Family was claiming benefit of Section 7[4] of the Wealth-tax Act in respect of the property known as Dhairya Prasad. The submission of the Revenue all through was that if property was not self- occupied, then, benefit of section 7[4] of the Act would not be available to the assessee.

In the matter of Commissioner of Wealth-tax v. Ashok Raje Gaekwad, reported in 267 ITR 54, the High Court has held in relation to occupancy and has found that the Hindu Undivided Family (HUF) would be entitled to benefits flowing from section 7[4] of the Wealth-tax Act. It is also WTR/93/1995 3/3 JUDGMENT to be noted that the matter was between the Revenue and the same assessee. In view of the said judgment, the question referred to this Court is answered against the Revenue. The Reference stands disposed of. [R.S. GARG, J.] [M.R. SHAH, J.] pirzada/-

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