2002 (8) TMI 82 - HC - Wealth-tax

Whether, on the facts and in the circumstances of the case, the Income tax Appellate Tribunal was correct in holding that the cinema theatre was entitled to exemption from wealth-tax for the assessment years 1987-88 and 1988-89 and accordingly quashing the order of the Commissioner of Wealth tax passed under section 26(2) of the Wealth-tax Act, 1957? - The word factory was not defined in the Finance Act of 1983. Naturally, the meaning assigned to this word in the Factories Act could be taken into account even for the purpose of wealth-tax. Under the Factories Act a cinema theatre was termed as a factory covered by the provisions of the said Act. In our considered judgment, the Tribunal has correctly interpreted the word factory occurring in the Finance Act of 1983. The cinema theatre was rightly treated as a factory and given exemption from wealth-tax. - We, therefore, answer the question in the affirmative, i.e., against the Revenue and in favour of the assessee.

Summary

The High Court of Madhya Pradesh ruled in favor of the assessee, stating that a cinema theatre is entitled to exemption from wealth-tax as it falls under the definition of a factory as per the Factories Act. The Tribunal's decision was upheld, and the question was answered in favor of the assessee.