COMMISSIONER OF WEALTH TAX Vs. SUSHEELA P THAMPY

JUDGEMENT

(1.) The Commissioner of Wealth-Tax, Thiruvananthapuram, is before us. 2. The questions referred for our opinion read:

(2.) Whether, on the facts and in the circumstances of the case, if the answer to the above question is in the negative, the direction to the Wealth Tax Officer to grant the exemption is justified -. The assessee purchased a house property on 7-6-71 at Bangalore for a total consideration of Rs. 1,12,730/-. In the declaration dated 22-6-1972, he had filed before the assessing authority, the assessee had stated that the property was purchased by her for the 'Thavazhi' consisting of herself, her son Dr. Mohan P. Thampy and daughter Smt. Thara K. Nair. However, by the letter dt. 1-1-73, the assessee had informed the Department that as on the date of purchase, the assessee was having with her a sum of Rs. 31,818/- belonging to the 'Thavazhi' (as per her books of account) and the said amount was made available to purchase the property. That however, was not sufficient. She therefore, had to contribute a sum of Rs. 80,813/- from out of her own funds for the purchase of the property. In conclusion the assessee stated that the above Rs. 80,813/- has been converted by her into property belonging to the family. Since the property acquired was a building, the assessee contended that the same shall not be included in his net wealth as she is entitled to the benefit of S.5(1)(iv) of the Wealth Tax Act.

(3.) The assessing authority was of the view that the amount contributed by the assessee under the circumstances can be deemed to be converted property within the meaning of S.4(1A) of the Wealth Tax Act and since the said converted property cannot be said to be a house or a part of the house, the exemption claimed by the assessee under S.5(1)(iv) cannot be granted. The assessee challenged this order by filing an appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner affirmed the order of the assessee and consequently dismissed the appeal. The Second Appeal filed by the assessee was allowed by the Appellate Tribunal by order dt. 11th May, 1981. The questions made mention of hereinbefore arise from out of this order.