2002 (8) TMI 91 - HC - Wealth-tax

Whether on the facts and in the circumstances and having regard to the interpretation of the lease deed the Tribunal was justified in confirming the valuation made by the Department in so far as it relates to the inclusion of reversionary value of the superstructure? - It is apparent that the confusion that has crept in the orders of the Assessing Officer is on account of the reliance placed on the valuation report which concerned the value of the interest of the lessor of the land who would at the end of the term of the lease become entitled to ownership of the superstructure. That approach to valuation was wholly irrelevant so far as the joint lessees of the land who had put up the superstructure and who were required to pay wealth-tax on that superstructure were concerned. The question referred to us is therefore answered in favour of the assessee and against the Revenue.

Summary

The High Court of Madras ruled in favor of the assessee regarding the valuation of a superstructure on leased land. The court found that the joint lessees were the owners of the building and had no reversionary interest. The Assessing Officer's reliance on a valuation report related to the lessor's interest in the land was deemed irrelevant. The court concluded that the valuation should be based on the joint lessees' ownership and not on any reversionary value.