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2017 (12) TMI 1011 - AT - Wealth-taxWealth tax assessment - valuation of properties - Held that - AO was compelled to estimate the values of properties as indicated above and assessed the net wealth of the assessee at ₹ 2,68,77.200/- as against ₹ 76,75,209/- on estimate basis vide his order dated 31.12.2009. After hearing both the parties and perusing the records especially the orders passed by the revenue authorities, we are of the view that the AO has given full opportunity to the assessee for substantiating its claim before him, but the assessee has not produced any evidence with respect to his contention relating to adoption of value of properties for Wealth Tax purposes and even before the Ld. CIT(A) and also before us. However, keeping in view of the tax effect involved in the case, being old matter and in the interest of justice, we are inclined to not set aside the issue in dispute to the AO and giving liberty to assessee to produce the evidence for its claim. But in the interest of justice, we think it proper to make reasonable estimate of properties too.
Issues Involved:
1. Estimation of market value of properties by the Assessing Officer (AO). 2. Evidence supporting the estimated values of properties. 3. Applicability of Wealth Tax exemptions. 4. Delay in filing appeals by the Assessee. 5. Tax effect and maintainability of the Revenue’s appeal. Detailed Analysis: Issue 1: Estimation of Market Value of Properties by the AO The Assessee contested the AO's estimation of market values for three properties: - 111/36, Kulri, Mussoorie - 17A/62, WEA, Karol Bagh, New Delhi - KN/F-14, Rai Kedar Nath Marg, Anand Parbat The AO estimated these properties at ?65,00,000, ?70,00,000, and ?40,00,000 respectively against the declared values of ?20,00,000, ?39,80,000, and ?7,00,000. The Tribunal found that the AO had given the Assessee an opportunity to substantiate its claims but the Assessee failed to produce any evidence. Consequently, the Tribunal made a reasonable estimate, reducing the AO's values to ?40,00,000, ?50,00,000, and ?20,00,000 respectively. Issue 2: Evidence Supporting the Estimated Values of Properties The Assessee failed to provide evidence for the values declared, such as municipal valuations or circle rates. The AO, therefore, estimated the values based on available information. The Tribunal upheld this approach but adjusted the values reasonably in the absence of concrete evidence from the Assessee. Issue 3: Applicability of Wealth Tax Exemptions The Assessee claimed exemptions under Section 2(ea)(1)(5) of the Wealth Tax Act for certain properties, arguing they were commercial. However, the AO did not accept these claims due to lack of supporting evidence. The Tribunal did not explicitly address the exemptions but focused on the valuation adjustments. Issue 4: Delay in Filing Appeals by the Assessee There was a minor delay of two days in filing the appeals. The Tribunal condoned this delay, noting it was not deliberate and was in the interest of justice. Issue 5: Tax Effect and Maintainability of the Revenue’s Appeal The Tribunal noted that the tax effect in the Revenue’s appeal was below the prescribed limit of ?10 lacs as per CBDT Circular No. 21/2015. Consequently, the Tribunal dismissed the Revenue’s appeal, emphasizing that appeals with tax effects below the specified limits should not be pressed. Conclusion: The Tribunal partly allowed the Assessee’s appeals by adjusting the estimated values of properties and dismissed the Revenue’s appeal due to the low tax effect. The decision underscores the importance of providing concrete evidence for property valuations and adhering to prescribed tax effect limits for filing appeals.
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