COMMISSIONER OF WEALTH TAX PATIALA vs. CHARANJIT SINGH

This appeal has been preferred by the revenue under Section 27-A of the Wealth Tax Act, 1957 (for short, “the Act”) against the order of the Income Tax Appellate Tribunal, Chandigarh dated 26.9.2007 in W.T.A.No.27/Chd/2006 for the assessment year 2003-04 claiming following substantial question of law:- “1. Whether on the facts and in the circumstances of the case, the ITAT was justified in law in confirming the order of the CIT(A) ignoring the fact that the straight line method adopted by the A.O. for measuring the distance of 3 km from the Municipal limits, was scientific and as per the spirit of notification dated 09.11.1993 read with the provisions of section 11 of General Clauses Act, 1897?

Whether on the facts and in the circumstances of the case, the ITAT was justified in law in not following its own decision and thus the rule of consistency in giving contrary decisions in two cases on identical issue?”

During the assessment, the assessee objected to inclusion of the land in dispute in the definition of assets under Section 2(ea) of the Act on the ground that the land was agricultural land beyond the prescribed distance from the municipal limits. The Assessing Officer rejected the said objection but the CWT(A) sustained the same, which has been affirmed by the Tribunal. The CWT(A) observed:- “4.3. ........... The issue involved has already been decided by my Ld. predecessor vide his appellate order for the A.Y. 2003-04 and by me vide my orders of date for the A.Yrs. 1998-99 to 2001-02 in the case of Sh. Kulbir Singh (HUF). The facts and circumstances relating to this issue being quite identical in both the cases and in all the years, following our earlier orders, it is held that the land measuring 66 kanals 2 Marlas is situated beyond the notified distance of 3 Kms from municipal limit and as such it is not asset chargeable to wealth tax with in the meaning of clause (ea) of section 2 of the wealth tax.....”

The above finding has been affirmed by the Tribunal.

We have heard learned counsel for the parties.

Learned counsel for the revenue submitted that the finding of fact recorded by the Tribunal holding the land in question to be beyond the notified distance from the municipal limit was perverse. In any case, consistent with the order in the connected case, matter should have been remanded to the Assessing Officer.

Learned counsel for the assessee points out that in the case of Kulbir Singh, the matter was remanded to the Assessing Officer and though the Assessing Officer held the land to be within the prescribed distance from the municipal limits, the CWT(A) vide order dated 24.7.2009 in Appeal No.172- 173/WT/CWT(A)/PTA/07-08, taking into account the fresh certificate issued by the Tehsildar, held the land to be not urban, being outside the notified distance from the municipal limits. In view of this development, apart from the fact that the CWT(A) and the Tribunal have concurrently recorded a finding of fact that the land in question was beyond the notified distance from the municipal limits, the fact remains that in the case of brother of the respondent-assessee, the revenue has accepted the finding of the CWT(A).

In view of above, we do not find any ground to hold the finding of the Tribunal to be perverse. The question No.1 has, thus, to be answered against the revenue and in favour of the assessee. As regards question No.2, since after the remand, the matter has been decided in favour of the assessee in the order mentioned above, the said question has also to be answered against the revenue. Accordingly, the appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE January 19, 2011 ( AJAY KUMAR MITTAL ) ashwani JUDGE 4