1980 (3) TMI 80 - HC - Wealth-tax

Summary

Issues:
1. Valuation of acquired property for wealth tax purposes based on Land Acquisition Act.
2. Determination of compensation payable to assessee for acquired property.
3. Discrepancy in valuation dates and applicable amounts.
4. Merger of Land Acquisition Officer's determination with Civil & Sessions Judge's order.
5. Correct amount of compensation to be included in wealth tax return.

Detailed Analysis:
The judgment by the High Court of Allahabad involved a case where agricultural land owned by the assessee was acquired by the State Government under the Land Acquisition Act. The Land Acquisition Officer initially determined the compensation payable at Rs. 98,430, which was later increased to Rs. 2,92,690 by the Civil & Sessions judge. The issue at hand was the valuation of the acquired property for wealth tax purposes. The Tribunal referred the question of whether the original assessment or the amount fixed by the Civil & Sessions Judge should be considered for wealth tax valuation.

The Court highlighted that under the Land Acquisition Act, the valuation of the acquired property is determined with reference to the date of notification under section 4 of the Act. The value of the asset, in this case, the compensation payable for the acquired property, was fixed as of the date of notification. The Court emphasized that the value of the asset remained constant across different assessment years as it was a monetary compensation.

For the assessment year 1964-65, the Court determined that the value of the asset on the relevant valuation date should be the amount determined by the Civil & Sessions Judge, which superseded the Land Acquisition Officer's determination. The Court held that the legally recognized compensation amount was Rs. 98,430 plus Rs. 2,92,690, as determined by the Civil & Sessions Judge. Therefore, the assessee was required to include this total amount in the wealth tax return for the specified assessment year.

In conclusion, the Court held that the valuation of the property for wealth tax purposes should be based on the amount eventually fixed by the Civil & Sessions Judge. The Commissioner was awarded costs amounting to Rs. 200.