COMMISSIONER OF WEALTH TAX Vs. SAROJA DEVI MODA

JUDGEMENT

(1.) THESE are references under Section 27 of the Wealth-tax Act, 1957 (hereinafter referred to as "the Act"), wherein the Income-tax Appellate Tribunal, Cuttack Bench, has framed the following common question for the opinion of this court:

(2.) FROM the orders passed by the different authorities as well as that of the Tribunal, it transpires that the house in question had been given to the assessee, Saroja Devi, along with her sister by the owner, the late Anna-purna Devi Sarogi, under a will and the sister, Shanti, had parted with her interest in the property in favour of Saroja by a registered gift deed, thereby Saroja becoming the sole owner in respect of the property in question. Under the provisions of Section 5(1)(iv) of the Act, one house or a part of a house belonging to the assessee is entitled to be exempted from the purview of the Wealth-tax Act. Admittedly, the house in question is the sole house belonging to the assessee. The Revenue, however, made an application before the Tribunal for making a reference under a misconception that the pre-amendment provisions would apply in respect of the relevant period for which returns had been filed as, under the pre-amendment provision, a house which is exclusively used by the assessee for residential purposes was to be exempted under Section 5(1)(iv) of the Act. The amended provision having come into force with effect from April 1, 1972, by the Finance (No. 2) Act, 1971, learned standing counsel for the Department fairly states that the present case will be governed by the amended provisions. Since the house in question is the only house of the assessee, there cannot be any manner of doubt that the said house is entitled to exemption under Section 5(1)(iv) of the Act. It is made clear that Section 5(1)(iv) has a proviso and the said proviso would apply when the valuation exceeds the limit contained therein. In that view of the matter, we have no manner of doubt that the Tribunal was wholly justified in granting exemption to the assessee in respect of the house in question under Section 5(1)(iv) of the Act.