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Issues Involved:
1. Whether the lands situated at Ambali, Vejalpur, and Makarba are urban lands and taxable under the Wealth Tax Act, 1957. Summary: Issue 1: Classification of Lands as Urban Lands The primary issue in this appeal was whether the lands situated at Ambali, Vejalpur, and Makarba should be classified as urban lands and thus taxable under the Wealth Tax Act, 1957. The assessee contended that these lands were agricultural and not urban lands, arguing that construction was not permissible under the law without prior permission from the District Collector as per Section 65 of the Bombay Land Revenue Code, 1879. The A.O. rejected this contention, stating that the mere fact that no permission had been sought for non-agricultural use did not change the status of the land as urban land. The A.O. noted that these lands were within 8 kms of the municipal limits of Ahmedabad Municipal Corporation and were surrounded by residential and commercial complexes, indicating their urban nature. Consequently, the A.O. included the value of these lands in the total wealth of the assessee and initiated penalty proceedings u/s 18(1)(c) of the Wealth Tax Act for furnishing inaccurate particulars of net wealth. The CWT(A) upheld the A.O.'s decision, agreeing that the lands fell within the definition of "urban land" as per Explanation (b)(ii) to Section 2(ea)(v) of the Wealth Tax Act, which includes land situated within 8 kms from the local limits of any municipality. The CWT(A) dismissed the assessee's argument that construction was not permissible, noting that the lands were in areas with significant urban development and that the prohibition on construction was conditional upon obtaining permission, not an absolute ban. The Tribunal, after hearing both parties, affirmed the findings of the lower authorities. It held that the lands in question were indeed urban lands as they were situated within 8 kms of the municipal limits of Ahmedabad Municipal Corporation. The Tribunal noted that Section 65 of the Bombay Land Revenue Code did not prohibit construction but required permission from the Collector, which did not change the urban character of the lands. The Tribunal concluded that the lands were taxable under the Wealth Tax Act and dismissed the assessee's appeal. Conclusion: The Tribunal upheld the classification of the lands at Ambali, Vejalpur, and Makarba as urban lands taxable under the Wealth Tax Act, 1957, and dismissed the assessee's appeal. The decision was based on the proximity of the lands to the municipal limits and the conditional nature of the construction prohibition under the Bombay Land Revenue Code.
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