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TMI Blog2018 (4) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... Since the issues involved in these appeals are common, the appeals are clubbed , heard together and disposed off in a common order for the sake of convenience as under. 2. All the grounds of appeal are related to the valuation of vacant land at Shaikpet Village. During the year under consideration, the assessees owned property of 1195 sq.yards of house site at Shaikpet Village, Rangareddy District and declared the value of property at ₹ 5,97,50,000/-. The assessees have claimed the property as exempt under section 2(ea) of Wealth Tax Act on the ground that the asset is stock-in-trade. During the assessment proceedings, the assessee submitted that the assessee had entered into an agreement for development of the land with M/s Vulcon Project Developers Pvt. Ltd, hence argued that the land in question is stockin- trade and business asset, hence it is exempt u/s 2(ea) of Wealth Tax Act. Alternatively, the assessee submitted that the impugned property was in dispute and a civil litigation was raised vide O.S.No.248 of 2003 in City Civil Court, Hyderabad and there was an injunction order on impugned land as per which status quo should be maintained till further orders are pas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting evidence was placed by the assessee with regard to the claim of the assessee as stock in trade. The property was not converted as a business asset in the relevant period. On identical facts in the case of DevineniAvinash for the A.Y.2009-10, the coordinate Bench of ITAT Vizag in WTA No.1/Vizag/2015 dated 10.06.2016 held that the asset is an investment but not stock in trade. For ready reference, we extract the relevant paragraphs of the ITAT s order which reads as under : 6. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. The factual matrix of the case which leads to levy of wealth tax is that assessee has purchased a land on 30.7.2007 and on the next day a MOU was entered into with the developer for developing the said land. The A.O. was of the opinion that the land held by the assessee is coming under the definition of urban land as defined u/s 2(ea) of the Act. The A.O. further was of the opinion that the assessee has purchased the land as an investor which was proved by his conduct that he had disclosed the said asset to the department as investment. It is the contention of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd as an investor, consequently any gains from the land would be assessable under the head income from capital gains. Therefore, we are of the view that the assessee has failed to prove that the impugned land held by him is stock-in-trade. 11.1. As the facts of the case are identical, respectfully following the view taken by the Coordinate Bench in the case cited supra, we hold that the asset is not stock in trade as claimed by the assessee and the assessee s appeal on this issue in ground no. 1.1. to 1.3 are dismissed. 5. With regard to the litigation of the property before the Hon ble City Civil Court in O.S.No.248 of 2003, where, an injunction order was issued to maintain status quo, Hon ble ITAT following the jurisdictional High Court order held that the property cannot be excluded from the definition of asset within the meaning of section 2(ea) of the Wealth Tax Act and accordingly confirmed the orders of the CWT(A). For ready reference, we extract relevant paragraphs of the order of the Tribunal in para No.13 to 14 which reads as under : 13. We have considered the arguments of the both the parties and perused the material placed on record. The above issue has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecified in this sub-Clauses (iv) yachts, boats and aircraft (other than those used by the assesseefor commercial Purposes); (v) urban land; (vi) cash in hand, in excess of fifty thousand rupees, of and Hindu - undivided families and in the case of other persons any amount not recorded in the books of account Explanation-1, For the purposes of this clause, - (a) Jewellery includes- - (I) ornaments made of gold, silver, platinum or any other (i) precious metal or any ay containing one or more of such precious metals, whether or not containing any precious or semi-precious stones and whether or not worked or sewn into any wearing apparel;- (ii) precious or semi-precious stores whether or not set in any furniture, utensils or other article or worked or sewn into any searing apparel; (b) urban and means land situate - (i) In any area which is comprised within the jurisdiction of a municipality (whether known as municipality, municipal corporation, notified area committee, town area committee , town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand; or (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le under any law for the time being in force in the area in which such land Is situated. 9. In the case on hand, there was a private property dispute which led to the filing of a Civil suit in O.S..No.248 of 2003. In that private property dispute there was an interim order to maintain status quo passed by the civil Court. Therefore, such an interim order of status quo passed by a City Civil Court prohibiting the assessee from putting up a constriction till the resolution of the private property dispute, does not tantamount to prohibition under any law for the time being in font in the area in which such land Is situated. 10. Therefore the Tribunal was completely wrong in thinking that wherever some Interim orders of prohibition have been passed in a private property dispute, the same would also fall under exclusion under Explanation-1(b). Hence, both the questions of law are liable to be answered in favour of the appellant/revenue. 14. Respectfully following the order of the Hon ble Jurisdictional High Court, we hold that the land in question cannot be excluded from the definition of asset from the definition of section 2(ea) of Wealth Tax Act and CWT(A) has ri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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