2020 (12) TMI 1059 - AT - Wealth-tax

Wealth tax assessment - whether property was let out and rental income was shown in the income tax returns filed for the relevant assessment years or not? - claim of the assessee that none of the assets are coming within the meaning of assets as defined u/s.2(ea) of the Wealth Tax Act, 1957, therefore, one more opportunity of hearing may be given to the assessee to go before the Assessing Officer to explain with necessary evidence and prove that assets are not coming within the ambit of Wealth Tax Act - HELD THAT - As considered the arguments of the assessee in light of the fact that the learned CWT(A) has decided the appeals without waiting for remand report called for from the Assessing Officer despite the fact that he himself has called for remand report regarding certain additional evidences filed by the assesse. Therefore, we are of the considered view that appeals filed by the assessee needs to go back to the file of the Assessing Officer to re-verify the averments made by the assessee in light of various evidences and to decide whether those assets are coming within the meaning of asset as defined u/s.2(ea) of the Wealth Tax Act, 1957. Hence, we set aside both the appeals filed by the assessee to the file of the Assessing Officer and direct him to redo the assessment after considering various evidences filed by the assessee.

Summary

Issues:
Appeals against common order of Commissioner of Wealth Tax for assessment years 2005-06 and 2006-07.

Analysis:
1. Common Grounds of Appeal:
The assessee raised common grounds of appeal for both assessment years. The issues included the addition of property value at Corporation Colony, exemption for property at Andheri, Bombay, exemption for property at KK Nagar, and withdrawal of exemption for a flat at Ashok Nagar. The appellant argued for deletion of additions to net wealth for these properties based on various provisions of the Act.

2. Background and Assessment:
The assessee did not file wealth tax returns for the relevant assessment years. The Assessing Officer reopened the assessments under section 17(1) of the Wealth Tax Act, 1957, based on income tax returns. The assessments were completed ex-parte, determining the net wealth for both years. The assessee appealed, leading to partial relief granted by the Commissioner of Wealth Tax (Appeals).

3. Appellant's Submission:
During the appeal, the appellant argued that the Commissioner decided the case without waiting for the remand report from the Assessing Officer. The appellant requested the appeals to be sent back for reconsideration based on additional evidence submitted.

4. Decision and Rationale:
After hearing both parties, the Tribunal found merit in the appellant's argument. It observed that the Commissioner had not waited for the remand report despite calling for additional evidence. Therefore, the appeals were set aside and directed to be reconsidered by the Assessing Officer to verify if the assets fall within the definition of assets under the Wealth Tax Act, 1957.

5. Outcome:
The Tribunal allowed the appeals for statistical purposes, sending them back to the Assessing Officer for re-assessment based on the evidences provided by the appellant.

In conclusion, the Tribunal found procedural irregularities in the Commissioner's decision-making process and ordered a re-verification of the assets to determine their taxability under the Wealth Tax Act, 1957.