COMMISSIONER OF WEALTH TAX Vs. H V MUNGALE

JUDGEMENT

(1.) THE question which has been referred in this reference at the instance of the Revenue under S. 27 (1) of the WT Act, 1957, is as follows :

(2.) THE assessee is admittedly the owner of a piece of land, bearing Survey No. 699, Hissa No. 1, situated at Poona Satara Road which was purchased by the assessee in the year 1955. In the course of the assessment proceedings Under the WT Act the assessee claimed that the property in question was agricultural land for which land revenue was being paid, and that it was liable to be excluded for the purposes of computation of wealth of the assessee having regard to the provisions of S. 2(e)(1)(i) of the said Act. The valuation report of the property was accepted by the WTO, who declined to exclude the value of the land while computing the net wealth of the assessee.

(3.) MR . Naik appearing on behalf of the Revenue has on the basis of the decision of the Supreme Court in CWT vs. Officer in Charge (Court of Wards), Paigah 1976 CTR (SC) 404 : (1976) 105 ITR 133 (SC) : TC64R.378, contended that the mere fact that the land was capable of being used for agricultural purposes was not enough to treat the land as agricultural land for the purposes of S. 2 (e)(1)(i) of the said Act. The learned counsel wants to point out that the decision of the Full Bench of the Andhra Pradesh High Court in Officer in Charge (Court of Wards) vs. CWT (1969) 72 ITR 552 (AP) : TC64R.386, relying on which the Tribunal held in favour of the assessee that the land in question was agricultural land, has now been reversed ; and, secondly, having regard to the decision of the Supreme Court referred to above, in which the Full Bench decision of the High Court had been reversed, the land in question could not be described as agricultural land. The learned counsel pointed out that the land in question is situated within the limits of the Poona Municipal Corporation and having regard to its location and surroundings the land could not be treated as agricultural land and the value thereof was liable to be included in the net wealth of the assessee.