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TMI Blog1986 (8) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... pleted according to the approved plan and was let out for running offices. After some dispute with the municipal corporation, property was got approved as property having 'commercial character'. It is presently being used as 'office' and 'show room', etc. In denying the above exemption to the assessee the AAC relied on several circumstances which chiefly are as under : (i) Explanatory note amending section 5(1)(iv) by the Finance (No. 2) Act, 1971, with effect from 1-4-1972. (ii) The word 'house' is not defined in the Act, but on the basis of decisions of the Allahabad High Court in the case of Shiv Narain Chaudhari v. CWT [1977] 108 ITR 104 and the Orissa High Court in CWT v. K.B. Pradhan [1981] 130 ITR 393, concept of house presupposes that the building should be meant for human habitation. (iii) As per the AAC, 'building' is a wider term and may 'include' house as well, but converse is not true. User of building is not material. (iv) When common parlance meaning is to be given to the word 'house' commercial buildings are clearly excluded from exemption under section 5(1)(iv). (v) Other expressions used by the Legislature in clauses (i), (ii), (iii) and (xxxi) of sub-se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(iv) prior to its amendment reads as under : "(5)(1) Subject to the provisions of sub-section (1A), wealth-tax shall not be payable by an assessee in respect of the following assets, and such assets shall not be included in the net wealth of the assessee.--- (i) to (iii) (iv) one house or part of a house belonging to the assessee and exclusively used by him for residential purposes." By the Finance (No. 2) Act, 1971 with effect from 1-4-1972 the words 'and exclusively used by him for residential purposes' were deleted and, therefore, the exemption was extended to one house or part thereof and the requirement that such house should be exclusively used by the assessee 'for residential purposes' was done away with. In the explanatory notes it was explained that the purpose of above amendment was to avoid 'general hardship to persons of small means who depend upon house property often as the sole means of livelihood'. The expression 'house property' has not been employed in the Wealth-tax Act but has well understood meaning under the Income-tax Act, 1961 ('the 1961 Act'). 'Income from house property' is one of the heads under which income is assessed under sections 22 to 27 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Board under the Act are binding on all officers and persons employed in the execution of the Act even if they deviate from the provision of the Act. Quite apart from binding character, the circular is clearly in the nature of Contemporanea expositio furnishing legitimate aid in the construction of clause (iv) of section 5(1). The rule of construction by reference to contemporanea expositio is a well established rule of interpretation. In Balishwar Bagarti v. Bhagirathi Das [1908] ILR 35 Cal. 701, Mookherjee, J. stated the rule in the following term : "It is a well settled principle of interpretation that courts in construing a statute will give much weight to the interpretation put upon it, at the time of its enactment and since by those whose duty it has been to construe, execute and apply it." The above statement of the rule was quoted with approval by the Supreme Court in Desh Bandhu Gupta Co. v. Delhi Stock Exchange Association Ltd. AIR 1979 SC 1049. 7. The decision of the Supreme Court in the case of Tata Engg. Locomotive Co. Ltd. really clinches the issue. In that case their Lordships were concerned with the meaning of the expression 'house' as used in section 89 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bitation, and may mean a building or shed intended or used as a habitation or shelter for animals of any kind, a building in the ordinary sense or any building, edifice, or structure inclosed with walls and covered, regardless of the fact of human habitation. Again in Corpus Juris Secundum, Vol. 41, page 365 it is said that under particular circumstances, the term has been held equivalent to and interchangeable or synonymous with 'building', 'dwelling' and 'dwelling house' and sometimes 'premises'." The decision of the Orissa High Court in K.B. Pradhan's case is not applicable as in that case the structure in respect of which exemption was claimed was admittedly incomplete and work on it was in progress on the valuation date. Their Lordships of the Orissa High Court denied exemption as incomplete construction was not a house as it had not reached a habitable stage. The Allahabad High Court decision in Shiv Narain Chaudhari's case dealt with the question---whether four different independent residential units which were connected by a common passage and bearing different municipal numbers could be treated as a house under section 5(1)(iv), i.e., with an issue totally different from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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