1997 (2) TMI 160 - AT - Wealth-tax

Assessing Officer, Assessment Order, Assessment Year, Factory Building, Land Appurtenant, Net Wealth, Wealth Tax Act

Summary

Issues:
- Inclusion of the value of plots of land within the assessable wealth of the assessee for three successive years.
- Interpretation of the term "appurtenant" in the context of wealth tax assessment.
- Determination of whether the plots of land can be considered as belonging or pertaining to the factory building of the assessee.

Analysis:
The judgment by the Appellate Tribunal ITAT Bangalore pertains to wealth-tax appeals filed by the assessee for three consecutive years. The primary issue was the inclusion of the value of plots of land in the assessable wealth of the assessee. The Assessing Officer contended that the plots were not declared in the wealth-tax returns and were considered as "appurtenant lands" of the factory. The CWT(Appeals) upheld the inclusion of the land values in the assessable wealth, but remitted the matter back for re-determining the market value. The key legal question revolved around the interpretation of the term "appurtenant" in the context of wealth tax assessment.

The judgment delved into the definition of "appurtenant," highlighting that it means "belonging or pertaining." The Assessing Officer noted that two plots were situated within the factory building area, indicating they could be considered as "land appurtenant" to the factory building. The Tribunal determined that for a plot to be appurtenant, it does not need to be inseparable from the factory building and can be sold separately. The decision emphasized that any land within the factory building area should be considered as appurtenant. Consequently, the Tribunal partially reversed the lower authorities' orders, directing that the values of two plots situated within the factory building area should not be included in the assessable wealth.

Regarding the third plot, its exact location was not specified. The Tribunal stated that if the plot was not within the factory building area, its value should be included in the assessable wealth. The matter concerning the third plot was remitted back to the Assessing Officer for determining its location. The judgment concluded by partially allowing the appeals filed by the assessee to the extent mentioned, emphasizing the importance of determining the appurtenance of the plots to the factory building for wealth tax assessment purposes.