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TMI Blog2005 (8) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... l purposes, no infirmity can be found in the order of the Tribunal, when it holds that both the buildings constituted a house belonging to the assessee and were exclusively used by him for residential purpose within the meaning of section 7(4) - - - - - Dated:- 10-8-2005 - Judge(s) : D. A. MEHTA., MS. H. N. DEVANI. JUDGMENT The judgment of the court was delivered by D.A. Mehta J.- The Income-tax Appellate Tribunal, Ahmedabad Bench "A", has referred the following question under section 27(3) of the Wealth-tax Act, 1957 ("the Act"), at the instance of the Commissioner of Wealth-tax, Rajkot: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in law in holding that two buildings, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd appeal before the Tribunal and the Tribunal vide its order dated December 14,1989, upheld the contention of the assessee. The Tribunal has taken cognizance of the fact that the assessee comes from the princely family of the erstwhile ruler of the State of Jamnagar and hence use of several residential units existing in a common compound and extended over vast area of land by such families as their residence cannot be viewed as an unusual mode of living. The Tribunal further held that: "It is not challenged that the two buildings known as Muff Villa and Queen Villa are quite contiguous and exist in one compound within common boundaries". Referring to the report of the Departmental Valuation Officer it is stated that the same does not rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim was made subsequently by a letter. He therefore urged that the Tribunal had erred in law in holding that the two properties constituted one single self-occupied property. Inviting attention to the provisions of section 7(4) of the Act, it was submitted that the language employed by the provision was plain and unambiguous and any use of the property for a purpose other than residential would disentitle the assessee from successfully claiming benefit of the provision. That Queen Villa was used for the office purpose as found by the Tribunal and therefore even on this count the Tribunal's order was incorrect. In so far as the preliminary contention is concerned, suffice it to state that the same was urged before the Tribunal but the T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain in that house and not to give it up. Referring to the earlier decision in the case of CWT v. W. Doraisamy [1995] 215 ITR 853 (Mad), it is held that "exclusively used for residential purposes" means that the assessee has the intention or animus manendi to live in the house, and further that no interest is created in the said property in favour of any other person. In other words, there is no element of right of any other person in the house property. In the case of CWT v. B.M, Bhandari [1980] 123 ITR 554, the Andhra Pradesh High Court while dealing with the expression "exclusively used by him for residential purposes" occurring in section 5(1)(iv) of the Act held that the expression "exclusively used by the assessee for residential pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 245 ITR 800 has laid down that the contention of the Revenue that the words "exclusively" used should be read as solely for residential purposes is not acceptable. The right of the property alone will play a prominent role and not the exclusive use. That the phrase "exclusively used" should be read to mean that the house should be used for residential purposes meaning thereby it should not be let out for rent or given on licence or used for commercial purposes. The legal position is therefore settled and there is a consensus of opinion amongst various High Courts as to the meaning to be assigned to the expression "exclusively used by him for residential purposes" to mean the property should not be put to any non-residential use. In other ..... X X X X Extracts X X X X X X X X Extracts X X X X
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