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1 W.P.18796/13 IN THE HIGH COURT OF KARNATAKA, BANGALORE
DATED THIS THE 23RD DAY OF JULY, 2013
BEFORE
THE HON'BLE MR.JUSTICE RAM MOHAN REDDY
WRIT PETITION NO. 18796 OF 2013 (T-WT)
BETWEEN:
M R RAGHURAM S/O. LATE M S RAMAIAH HINDU, AGE 54 YEARS GOKULA HOUSE, M S R ROAD BANGALORE - 560 054. … PETITIONER
(BY SRI. S GANESH SHENOY, ADVOCATE)
AND :
THE WEALTH-TAX OFFICER INCOME TAX DEPARTMENT WARD No. 6(3), 4TH FLOOR RASHTROTHANA PARISHATH BUILDING NRUPATHUNGA ROAD BANGALORE - 560 001. … RESPONDENT
(BY SRI. E I SANMATHI, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED DEMAND MADE BY THE RESPONDENT (THE WEALTH – TAX OFFICER, WARD No. 6(3) BANGALORE ) AS PER ANN-G (FOR THE ASSESSMENT YEAR 2005-06 DT. 28.03.13) & THE
2 W.P.18796/13 CONSEQUENTIAL DEMAND ANN-H (FOR THE ASSESSMENT YEAR 2005-06 DT. 28.03.13); AND ETC.
THIS WRIT PETITION COMING ON FOR PRL.HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
Petitioner, owner of land measuring 61 Acres and 22 Guntas of land comprised in Sy. Nos.32, 37/19, 37/20, 37/21, 37/25 and 37/32 of Aklenahalli, kasaba hobli, Devanahalli Taluk, Bangalore Rural District, an assesseee for the purpose of agricultural income and Wealth-tax under the Wealth-tax Act, 1957, having filed a return for the assessment year 2005-06, declaring that the agricultural lands are exempt from tax under the Wealth-tax Act, 1957, for short “Act”, in the light of its exclusion in the definition of the term ‘urban land’ in clause (b) of Explanation 1 to sub- section 2(ea) of the Act and on the premise that Karnataka Land Revenue Act, 1964, does not permit the
3 W.P.18796/13 construction of any building on the said agricultural lands unless permitted under Section 95 to divert the agricultural lands to be put to use for any other purpose. The respondent – Wealth Tax Officer, having taken up for assessment the said return, declined to accept the petitioner`s submission over Section 95(2) of the Karnataka Land Revenue Act, and held that since the assessee is not barred from converting the land and construction of buildings thereon and as the Bangalore International Airport Area Planning Authority (BIAPPA) had notified 214 localites / villages including the land in question for the purpose of urbanization / development, also falling within the municipal limits of Devanahalli Municipality, held that the agricultural lands were “urban lands” liable to wealth-tax, by the assessment order dated 28.03.2013 Annexure ‘G’, followed by a demand notice Annexure ‘H’. Hence, this writ petition.
4 W.P.18796/13
It is unnecessary to extract clause (b) of explanation 1 to Section 2(ae) of the Wealth-tax Act, 1957 in which the ‘urban land’ is defined to exclude land on which construction of a building is not permissible. Suffice it to state that the provisions of the Karnataka Land Revenue Act, 1964, does not permit construction of buildings on agricultural lands unless the Deputy Commissioner exercises a jurisdiction under Section 95 of the said Act, to permit the owner or occupier of the agricultural lands to divert the use of the land from agriculture to non-agriculture purposes, on an application. Therefore, unless the petitioner makes an application to the Deputy Commissioner for permission to divert the said land from agriculture to non-agricultural purposes and the Deputy Commissioner applies his mind and extends permission, based upon the purpose for which the land is notified in the master plan under Section 13 of the
5 W.P.18796/13 Karnataka Town and Country Planning Act, 1961, the land of the petitioner continues to be classified as agricultural land, liable to land revenue.
In that view of the matter, the respondent fell in error in concluding that since the petitioner – assessee is not barred from converting land and constructing building thereto, the land falls within the definition of the term ‘urban land’ for the purpose of wealth-tax. This finding, in my opinion, is perverse and calls for interference with the assessment order.
In the result, this petition is allowed. The order of assessment dated 28.03.2013 Annexure ‘G’ of the respondent – in so far as it relates to inclusion of the agricultural land belonging to the petitioner as ‘urban land’ for the purpose of wealth-tax is quashed. The proceeding is remitted to the respondent for
6 W.P.18796/13 consideration afresh over the return filed by the petitioner other than on the agricultural land.
Sd/-
JUDGE
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