1980 (8) TMI 109 - AT - Wealth-tax

Summary

Issues:
1. Application of multiple in determining market value of the property 'Himanshu Bhawan', Jaipur.
2. Deduction of repairs and collection charges.
3. Deduction of a sum from the fair market value on account of declaration under the Voluntary Disclosure Act, 1976.

Analysis:

Issue 1: Application of multiple in determining market value
The appeals addressed the controversy surrounding the application of a multiple in determining the market value of the property 'Himanshu Bhawan'. The WTO valued the property at Rs. 6,97,000, while the AAC reduced it by applying a multiple of 12. The assessee contended for a multiple of 8 times based on a previous decision. The Tribunal considered the evidence and grounds of appeal, concluding that a multiple of 10 times would be reasonable, citing a previous court decision. The market value was determined accordingly.

Issue 2: Deduction of repairs and collection charges
The AAC allowed a deduction of 1/6th towards repairs, which was deemed reasonable and in line with departmental practices. Regarding collection charges, the AAC's decision was upheld as justifiable. The assessee had to send personnel for rent collection and faced tenant disputes, justifying the 6% deduction for collection charges.

Issue 3: Deduction on account of declaration under the Voluntary Disclosure Act
A deduction of Rs. 50,000 from the fair market value of 'Himanshu Bhawan' on account of a declaration under the Voluntary Disclosure Act, 1976, was contested. The authorities initially disallowed the deduction, but the assessee argued for its allowance. The Tribunal held that the relief under the Voluntary Disclosure Scheme is independent and statutory, thus should be allowed separately. The assessee was granted relief in all relevant years.

In conclusion, some appeals were allowed in part while others were dismissed, based on the Tribunal's findings on the application of multiples, deductions for repairs and collection charges, and the allowance of deductions under the Voluntary Disclosure Act.